(x) result in a FOIA Person holding an interest in the Partnership.
Such legal opinion shall be provided to the General Partner by the transferring
Limited Partner or the proposed transferee, and any costs associated therewith shall be borne by
the transferring Limited Partner or the proposed transferee.
(b) Prior to making any pledge, sale, assignment or transfer of a Limited
Partner interest, a Limited Partner shall first give written notice to the General Partner describing
the proposed transferee and the terms and conditions of the transaction, and such interest may be
transferred by the Limited Partner according to the terms and conditions specified in the notice
upon obtaining the consent specified in subparagraph (a) above.
(c) In the case of transfers made in connection with an Event of Default or as
necessary to comply with applicable provisions of law, each Limited Partner hereby irrevocably
appoints and designates the General Partner as attorney-in-fact for and on behalf of such Limited
Partner to effect any transfer of that Limited Partner’s interest in the Partnership in the manner
provided in this Section 9 if, and to the extent, such transferring Limited Partner fails to timely
execute or deliver any documents as requested by the General Partner under this Section 9.3.
9.3 Substitution as a Limited Partner. An assignee of a Limited Partner’s interest
pursuant to this Section shall become a substituted Limited Partner only with the consent of the
General Partner (which consent the General Partner may grant or withhold, condition or delay, in
its sole and absolute discretion) and only if such assigneee (a) elects to become a substituted
Limited Partner by delivering a notice of such election to the Partnership, (b) executes,
acknowledges and delivers to the Partnership such other instruments as the General Partner may
deem necessary or advisable to effect the admission of such transferee as a substituted Limited
Partner, including, without limitation, the written acceptance and adoption by such assignee of
the provisions of this Agreement, (c) makes all the representations and warranties previously
made by Limited Partners under this Agreement or in any Subscription Agreement; and (d) pays
any and all costs and expenses as set forth in Section 9.5. In the event that a Limited Partner
transfers all of its Interest in the Partnership in accordance with this Agreement, such assignee
shall be deemed admitted to the Partnership as a Limited Partner effective immediately prior to
the transfer upon its execution of a counterpart to this Agreement.
9.4 Expenses of Transfer; Indemnification. All expenses, including attorneys’ fees
and expenses, incurred by the General Partner or the Partnership in connection with any transfer
by a Limited Partner shall be borne by the transferring Limited Partner or such Limited Partner’s
assignee. In addition, unless otherwise agreed in writing by the General Partner, the transferring
Limited Partner or such assignee shall indemnify the Partnership and the General Partner in a
manner satisfactory to the General Partner against any losses, claims, damages or liabilities to
which the Partnership or the General Partner may become subject arising out of or based upon
any false representation or warranty made by, or breach or failure to comply with any covenant
or agreement of, such transferring Limited Partner or such assignee in connection with the
transfer.
314346824.12 22
SECTION 10. DISSOLUTION AND LIQUIDATION OF THE PARTNERSHIP;
LIQUIDATION OF GENERAL PARTNERS’ INTEREST
10.1 Winding Up after an Event of Dissolution. The Partnership shall dissolve upon
the occurrence of any Event of Dissolution. Upon any Event of Dissolution specified in Section
14.13, a Majority in Interest of the Partners shall elect one or more liquidating trustees to manage
the winding up of the Partnership if there is no General Partner. Otherwise the General Partner
shall manage the winding up of the Partnership.
10.2 Procedure if Partnership Continues with Successor General Partner. If the
Partnership is continued without dissolution in accordance with Section 14.13(b)(B), effective as
of the date the General Partner ceased to be a general partner of the Partnership (the “Cessation
Date”), the Partnership interest of the former general partner shall be converted to, and shall
become, a Limited Partner interest and the former general partner shall become a Limited Partner
entitled to receive the amounts that would otherwise have been distributed to it as a Partner
pursuant to Section 7 and Section 10.4 in respect of its capital contributions to the Partnership.
10.3 Winding Up Procedures.
(a) Promptly upon dissolution of the Partnership, the affairs of the Partnership
shall be wound up and the Partnership assets liquidated. The closing Capital Accounts of all the
Partners shall be computed as of the date of dissolution as if the date of dissolution were the last
day of an Accounting Period in accordance with Section 5, and then adjusted in the following
manner:
(i) All assets and liabilities of the Partnership shall be valued as of the
date of dissolution. For purposes of this Section 10.3(a), the amount of any obligation of any
Partner to the Partnership shall be deemed an asset of the Partnership.
(ii) The Partnership’s assets as of the date of dissolution shall be
deemed to have been sold at their fair market values and the resulting Profit or Loss shall be
allocated to the Partners’ Capital Accounts in accordance with the provisions of Section 5. The
result for each Partner shall be its closing Capital Account.
(b) Distributions in winding up may be made in cash or in kind or partly in
cash and partly in kind. The General Partner or the liquidating trustee shall use its judgment as
to the most advantageous time for the Partnership to sell investments or to make distributions in
kind. Subject to Section 17-804 of the Delaware Act, all cash and each Security distributed in
kind after the date of dissolution of the Partnership shall be distributed ratably in accordance
with the General Partner and the Limited Partners’ positive Capital Account balances, unless
such distribution would result in a violation of a law or regulation applicable to a Limited Partner
or a tax penalty to such Limited Partner, in which event, upon receipt by the General Partner of
notice to such effect, such Limited Partner may designate a different entity to receive the
distribution, or designate, subject to the approval of the General Partner, an alternative
distribution procedure (provided such alternative distribution procedure does not prejudice any
of the other Partners). Each Security so distributed shall be subject to reasonable conditions and
314346824.12 23
restrictions necessary or advisable in order to preserve the value of such Security or for legal
reasons.
10.4 Payments in Liquidation. The assets of the Partnership shall be paid or
distributed in winding up of the Partnership in the following order:
(a) to the creditors of the Partnership, other than Partners, in satisfaction of all
liabilities of the Partnership, in the order of priority established by law (whether by payment or
by the making of reasonable provision for payment thereof);
(b) to the Partners, in satisfaction of any loans made to, or other debts owed
by the Partnership to such Partners;
(c) to the General Partner in return (by cancellation of any note) of the unpaid
principal amount of any note delivered by the General Partner to the Partnership and not credited
to its Capital Account; and
(d) to the General Partner and the Limited Partners in respect of the positive
balances in their Capital Accounts in compliance with Treasury Regulation Sections 1.704-
1(b)(2)(ii)(b).
SECTION 11. FINANCIAL ACCOUNTING, REPORTS, MEETINGS AND VOTING.
11.1 Financial Accounting; Fiscal Year. The books and records of the Partnership
and the General Partner shall be kept by the General Partner in accordance with the provisions of
this Agreement and otherwise in accordance with United States generally accepted accounting
principles consistently applied, and shall be audited by an independent accountant selected by the
General Partner which is registered with, and subject to examination by, the Public Company
Accounting Oversight Board. The Partnership’s fiscal year shall be the calendar year. It is
agreed and understood that, for purposes of maintaining its books and records and producing the
reports required hereunder, the Partnership shall not be required to consolidate (or otherwise
combine) its financial results with those of its Portfolio Companies whether or not generally
accepted accounting principles would require such consolidation (or other form of combination).
The Limited Partners acknowledge that the General Partner and the Partnership’s accountants
will require information from third parties in order to comply with the requirements of this
Section 11.1 and Sections 11.4 and 11.5, and agree that neither shall have liability to the
Partnership or the Limited Partners in connection therewith so long as they exercise
commercially reasonable efforts in seeking to obtain such information on a timely basis.
11.2 Supervision; Inspection of Books. Proper and complete books of account of the
business of the Partnership, copies of the Partnership’s financial statements and federal, state and
local tax returns for at least the last six (6) fiscal years of the Partnership, the partner information
set forth on Schedule A of this Agreement, and the Partnership’s Certificate of Limited
Partnership shall be kept under the supervision of the General Partner at the principal office of
the Partnership. For purposes of this Agreement; proper and complete books of account of the
affairs of the Partnership shall mean solely: (i) the limited partnership agreement of the
314346824.12 24
Partnership and all amendments thereto; (ii) the certificate of limited partnership of the
Partnership, as filed with the Secretary of State of Delaware, and all amendments thereto; (iii) all
effective waivers of the Partnership executed by the Limited Partners and the General Partner;
and (iv) the Partnership’s federal, state and local income tax returns for each year. Such proper
and complete books and records shall be open to inspection by Limited Partners or their
authorized representatives in accordance with all applicable law, including, but not limited to, the
Delaware Act.
11.3 Quarterly Reports. The General Partner shall transmit, or cause the
transmission, to the Limited Partners within ninety (90) days after the close of each fiscal quarter
an unaudited status report on the Partnership for the quarter.
11.4 Annual Report; Financial Statements of the Partnership. The General Partner
shall transmit, or cause to be transmitted, to the Limited Partners within one hundred twenty
(120) days after the close of the Partnership’s fiscal year, audited financial statements of the
Partnership prepared in accordance with the terms of this Agreement and otherwise in
accordance with United States generally accepted accounting principles, including an income
statement for the year then ended, a balance sheet as of the end of such year, a statement of
changes in the Partners’ Capital Accounts for the year then ended and a list of investments then
held.
11.5 Tax Returns. The General Partner shall use its reasonable efforts to cause the
Partnership’s tax return and IRS Form 1065, Schedule K-1, to be prepared and delivered to the
Limited Partners within one hundred twenty (120) days after the close of the Partnership’s fiscal
year and shall provide such other information as may be needed by any Limited Partner to enable
it to file any required return or report. In the event the General Partner is unable to deliver a
Schedule K-1 within one hundred twenty (120) days after the close of the Partnership’s fiscal
year, the General Partner will furnish each of the Limited Partners an estimated Schedule K-1 by
such date.
11.6 Tax Matters Partner. The General Partner shall be the Partnership’s tax matters
partner under the Code and under any comparable provision of state law. The General Partner
shall have the right to resign as tax matters partner by giving thirty (30) days written notice to
each Partner if the General Partner reasonably believes that there may be a conflict of interest
between its interests and those of any other Partner. Upon such resignation, a successor tax
matters partner shall be elected by a Majority in Interest of the Limited Partners. The tax matters
partner shall employ experienced tax counsel to represent the Partnership in connection with any
audit or investigation of the Partnership by the Internal Revenue Service and in connection with
all subsequent administrative and judicial proceedings arising out of such audit. If the tax
matters partner is required by law or regulation to incur fees and expenses in connection with tax
matters not affecting all the Partners, then the tax matters partner may, in its sole and absolute
discretion, seek reimbursement from those Partners on whose behalf such fees and expenses
were incurred. The tax matters partner shall keep the Partners informed of all administrative and
judicial proceedings, as required by Section 6223(g) of the Code, and shall furnish to each
Partner, if such Partner so requests in writing, a copy of each notice or other communication
received by the tax matters partner from the Internal Revenue Service, except such notices or
communications as are sent directly to such requesting Partner by the Internal Revenue Service.
314346824.12 25
The relationship of the tax matters partner to the Limited Partners is that of a fiduciary, and the
tax matters partner has fiduciary obligations to perform its duties as tax matters partner in such
manner as will serve the best interests of the Partnership and all of its Partners. To the fullest
extent permitted by law, the Partnership agrees to indemnify the tax matters partner and its
agents and save and hold them harmless, from and in respect to all (i) fees, costs and expenses in
connection with or resulting from any claim, action or demand against the tax matters partner,
the General Partner or the Partnership that arises out of or in any way relates to the tax matters
partner’s status as tax matters partner for the Partnership, and (ii) all such claims, actions and
demands and any losses or damages therefrom, including amounts paid in settlement or
compromise of any such claim, action or demand.
11.7 Meetings. The General Partner, in its sole and absolute discretion, may designate
in a notice to the Limited Partners delivered at least thirty (30) days in advance of the scheduled
date, the date of an annual meeting of Limited Partners. Limited Partners shall not be able to call
meetings of the Limited Partners, except as determined by the General Partner in its sole and
absolute discretion.
11.8 Banking. All uninvested funds of the Partnership shall be invested by the
General Partner in the Custodial Account, which shall be determined by the General Partner in
its sole and absolute discretion. All withdrawals by check or otherwise from such accounts or
funds shall be made by individuals designated for such purposes by the General Partner.
11.9 Voting. Limited Partners shall vote in the ratio of their Partnership Percentages
and shall be deemed a single class and group of limited partners of the Partnership for all
purposes of the Delaware Act and this Agreement. Except as specifically set forth in this
Agreement or as provided by applicable law, the Limited Partners shall have no right to vote, call
a meeting of Partners, or otherwise take any action on any matter relative to the Partnership and
its affairs, including, but not limited to, (i) the dissolution of the Partnership, (ii) the incurrence
of debt by the Partnership, (iii) transactions involving an actual or potential conflict of interest
between a General Partner and the Partnership or any Limited Partners, (iv) removal of the
General Partner, (v) continuation of the business of the Partnership after its dissolution, or (vi)
the admission of a General Partner.
SECTION 12. VALUATION
12.1 Valuation.
(a) The valuation of Securities and other assets and liabilities under this
Agreement shall be at fair market value as determined by the General Partner, subject to
Section 12.1(b) below. Except as may be required under applicable Treasury Regulations, no
value shall be placed on the goodwill or the name of the Partnership in determining the value of
the interest of any Partner or in any accounting among the Partners. The following criteria will
be used for determining the fair market value of Securities:
(i) Securities not subject to investment letter or other similar
restrictions on free Marketability:
314346824.12 26
(A) If traded on one or more securities exchanges or the Nasdaq
National Market System, the value shall be deemed to be the Securities’ closing price on such
exchange(s) or system on the valuation date or the last trading day preceding the valuation date.
(B) If actively traded over-the-counter (other than on the
Nasdaq National Market System), the value shall be deemed to be the closing price of such
Securities on the valuation date or the last trading day preceding the valuation date. If no sale
occurred on any of such dates, then the last bid price on such date shall be used for purposes of
the calculation herein.
(C) If there is no active public market, the value shall be the
fair market value thereof, as determined by the General Partner, taking into consideration the
purchase price of the Securities, developments concerning the Portfolio Company subsequent to
the acquisition of the Securities, any financial data and projections of the Portfolio Company
provided to the General Partner, and such other factor(s) as the General Partner may deem
relevant.
(ii) Securities subject to investment letter or other restrictions on free
Marketability shall be valued by making an appropriate adjustment from the value determined
under (A), (B), or (C) above to reflect the effect of the restrictions on transfer.
(iii) An appropriate adjustment may be made for any control premiums
associated with the Securities.
(b) The General Partner shall make any requisite adjustments to the valuation
methods applied by the General Partner so that they are not inconsistent with generally accepted
accounting principles when such principles are required to be applied by the Partnership or the
Partnership’s independent accountants.
(c) If the General Partner in good faith determines that, because of special
circumstances, the valuation methods set forth in Section 12.1(a) and (b) do not fairly determine
the value of a security, the General Partner shall make such adjustments or use such alternative
valuation method as it deems appropriate.
SECTION 13. PARTNERS SUBJECT TO SPECIAL REGULATION.
13.1 ERISA Partners.
(a) Each Limited Partner that is an “employee benefit plan” or that is an entity
that is deemed to hold “plan assets” within the meaning of, and subject to the provisions of,
ERISA (an “ERISA Partner”), and the fiduciary or other Person making the decision to invest in
the Partnership on behalf of such Limited Partner, hereby (i) acknowledges that it is its
understanding that neither the Partnership, the General Partner, nor any of the Affiliates of the
General Partner, are “fiduciaries” within the meaning of ERISA, of such ERISA Partner or any
plan(s) for which such ERISA Partner holds “plan assets” by reason of the ERISA Partner
investing in, and being a Limited Partner of, the Partnership; (ii) acknowledges that the ERISA
Partner has been informed of and understands the investment objectives and policies of, and the
investment strategies that may be pursued by, the Partnership; (iii) acknowledges that the ERISA
314346824.12 27
Partner is aware of the provisions of Section 404 of ERISA relating to the requirements for
investment and diversification of the assets of employee benefit plans and trusts subject to
ERISA; (iv) represents that the ERISA Partner has given appropriate consideration to the facts
and circumstances relevant to the investment by the ERISA Partner in the Partnership and has
determined that such investment is reasonably designed, as part of such portfolio, to further the
purposes of such ERISA Partner and any plan(s) for which such ERISA Partner holds “plan
assets”; (v) represents that, taking into account the other investments of such ERISA Partner, and
the diversification thereof, such ERISA Partner’s investment in the Partnership is consistent with
the requirements of Section 404 and other provisions of ERISA; (vi) acknowledges that the
ERISA Partner understands that current income will not be a primary objective of the
Partnership; and (vii) represents that, taking into account the other investments of such ERISA
Partner, the investment of assets of such ERISA Partner in the Partnership is consistent with the
cash flow requirements and funding objectives of such ERISA Partner and any plan(s) for which
it holds “plan assets.”
(b) Notwithstanding any provision contained herein to the contrary, each
ERISA Partner may elect to withdraw from the Partnership, or upon demand by the General
Partner shall withdraw from the Partnership, at the time and in the manner hereinafter provided,
if either the ERISA Partner or the General Partner shall obtain an opinion of counsel (which
counsel shall be reasonably acceptable to both the ERISA Partner and the General Partner) to the
effect that, as a result of applicable statutes, regulations, case law, administrative interpretations
or similar authority (i) the continuation of the ERISA Partner as a Limited Partner of the
Partnership or the conduct of the Partnership will result, or there is a material likelihood the same
will result, in a material violation of ERISA, or (ii) all or any portion of the assets of the
Partnership constitute assets of the ERISA Partner for the purposes of ERISA and are subject to
the provisions of ERISA to substantially the same extent as if owned directly by the ERISA
Partner. Thereupon, unless within one hundred twenty (120) days after receipt of such written
notice and opinion, the General Partner is able to eliminate the necessity for such withdrawal to
the reasonable satisfaction of the ERISA Partner and the General Partner, whether by correction
of the condition giving rise to the necessity of the ERISA Partner’s withdrawal, or the
amendment of this Agreement, or otherwise, such ERISA Partner shall withdraw its entire
interest in the Partnership, such withdrawal to be effective upon the last day of the fiscal quarter
during which such one hundred twenty (120) day period expired.
(c) The withdrawing ERISA Partner shall be entitled to receive within one
hundred twenty (120) days after the date of such withdrawal an amount equal to the fair market
value of such Partner’s interest as of the effective date of such withdrawal.
(d) Any distribution or payment to a withdrawing ERISA Partner pursuant to
this paragraph may, in the sole and absolute discretion of the General Partner, be made in cash,
in Securities, in the form of a promissory note, the terms of which shall be mutually agreed upon
by the General Partner and the withdrawing ERISA Partner, or any combination thereof.
13.2 Governmental Plan Partners. Notwithstanding any provision of this Agreement
to the contrary, any Limited Partner that is a “governmental plan” as defined in Title 29,
section 1002(32) of the United States Code (a “Governmental Plan Partner”) may elect to
withdraw from the Partnership, or upon demand by the General Partner shall withdraw from the
314346824.12 28
Partnership, if either the Governmental Plan Partner or the General Partner shall obtain an
opinion of counsel (which counsel shall be reasonably acceptable to both the Governmental Plan
Partner and the General Partner) to the effect that the Governmental Plan Partner, the Partnership
or the General Partner (including its Affiliates) would be in violation of any statute or regulation
of the state of residence of the Governmental Plan Partner or any political subdivision of such
state, enacted or promulgated after the date of formation of the Partnership, as a result of the
Governmental Plan Partner continuing as a Limited Partner. In the event of the issuance of the
opinion of counsel referred to in the preceding sentence, the withdrawal of and disposition of the
Governmental Plan Partner’s interest in the Partnership shall be governed by Section 13.1 of this
Agreement, as if the Governmental Plan Partner were an ERISA Partner.
13.3 Private Foundation Partners. Notwithstanding any provision of this Agreement
to the contrary, any Limited Partner that is a “private foundation” as described in Section 509 of
the Code (a “Private Foundation Partner”), may elect to withdraw from the Partnership, or
upon demand by the General Partner shall withdraw from the Partnership, if either the Private
Foundation Partner or the General Partner shall obtain an opinion of counsel (which counsel
shall be reasonably acceptable to both the Private Foundation Partner and the General Partner) to
the effect that such withdrawal is necessary in order for the Private Foundation Partner to avoid
(a) excise taxes imposed by Subchapter A of Chapter 42 of the Code (other than Sections 4940
and 4942 thereof), or (b) a material breach of the fiduciary duties of its trustees or directors under
any federal or state law applicable to private foundations or any rule or regulation adopted
thereunder by any agency, commission, or authority having jurisdiction. In the event of the
issuance of the opinion of counsel referred to in the preceding sentence, the withdrawal of and
disposition of the Private Foundation Partner’s interest in the Partnership shall be governed by
Section 13.1 of this Agreement, as if the Private Foundation Partner were an ERISA Partner.
13.4 Public Charity Partners. Notwithstanding any provision of this Agreement to
the contrary, any Partner that is an “applicable tax-exempt organization” within the meaning of
Section 4958 of the Code (a “Public Charity Partner”) may elect to withdraw from the
Partnership, or upon demand of the General Partner shall withdraw from the Partnership, if either
the Public Charity Partner or the General Partner shall obtain an opinion of counsel (which
counsel shall be reasonably acceptable to both the Public Charity Partner and the General
Partner) to the effect that such withdrawal is necessary to avoid (a) sanctions under Code
Section 4958 or (b) a material breach of the fiduciary duties of its trustees or directors under any
federal or state law applicable to charitable organizations or any rule or regulation adopted
thereunder by any agency, commission or authority having jurisdiction. In the event of the
issuance of the opinion of counsel referred to in the preceding sentence, the withdrawal of and
disposition of the Public Charity Partner’s interest in the Partnership shall be governed by
Section 13.1 of this Agreement, as if the Public Charity Partner were an ERISA Partner.
13.5 Bank Holding Company Partners.
(a) Notwithstanding any provision of this Agreement to the contrary, if any
Limited Partner that is subject to the Bank Holding Company Act of 1956, as amended (the
“BHC Act”), or is an Affiliate of an entity subject to the BHC Act, (each “BHC Partner”)
delivers to the General Partner an opinion of counsel (in form and substance reasonably
acceptable to the General Partner) to the effect that there is a reasonable likelihood that such
314346824.12 29
BHC Partner’s continued ownership of its interest, in whole or in part, would result in (i) a
violation by such BHC Partner or any of its Affiliates of Section 4 (other than Section 4(k)) of
the BHC Act or the rules, regulations and interpretations relating thereto, with respect to the
BHC Partner’s interest in the Partnership or any Portfolio Company, or (ii) the application to the
BHC Partner or any of its Affiliates of any law or regulation applicable to banks, bank holding
companies or their Affiliates with respect to its interest in the Partnership or any such Portfolio
Company that was not applicable to such BHC Partner at the time of its admission to the
Partnership, then the General Partner shall use reasonable efforts to take such actions as the
General Partner determines, with the approval of such BHC Partner (such approval not to be
unreasonably withheld), to be appropriate to avoid or cure such violation, which actions may
include excusing such BHC Partner from making all or a portion of any required Capital
Contribution, canceling all or a portion of the Capital Commitment of such BHC Partner,
assisting in the sale in whole or in part of such BHC Partner’s interest, permitting the full or
partial withdrawal of such BHC Partner from the Partnership, or other mutually acceptable
solutions. Any such withdrawal will be effective for all purposes (including as to the exercise of
voting and other rights) upon the effective time of withdrawal notwithstanding that payment on
account of a withdrawal may be made after the effective time, and any completely withdrawing
BHC Partner will not be considered a Partner for any purpose after the effective time of such
complete withdrawal.
(b) Notwithstanding any contrary provision in this Agreement, any BHC
Partner may elect, by notice in writing to the General Partner or the liquidator, as the case may
be, to decline the receipt of distributions in kind if the receipt thereof would be in excess of the
“Permitted Amount,” as defined below. The “Permitted Amount” means, with respect to any
specified class of Marketable Securities and in connection with any distribution by the General
Partner of any such Marketable Securities to any BHC Partner, the least of (i) that portion of
such class of Marketable Securities to be distributed that would otherwise be distributed to such
BHC Partner pursuant to the terms of this Agreement, (ii) an amount of such class of Marketable
Securities which equals 4.99% (or such higher percentage as such BHC Partner may designate
by written notice to the General Partner) of the aggregate outstanding amount of such class of
Marketable Securities, or (iii) such other amount as may be specified by such BHC Partner.
(c) If that portion of any Marketable Securities to be distributed by the
General Partner that would otherwise be distributed to a BHC Partner pursuant to the terms of
this Agreement exceeds the Permitted Amount, then the amount of such excess (the “Excess
Securities”) will be deposited by the General Partner into an account (the “Escrow Account”)
established for the benefit of such BHC Partner. Unless the General Partner notifies the BHC
Partner to the contrary, the General Partner shall act as the agent for the Escrow Account (the
“Escrow Agent”). If the General Partner serves as the Escrow Agent then: (i) the Escrow Agent
will have the right to exercise any and all voting rights with respect to such Excess Securities for
so long as such excess Securities remain in the Escrow Account; (ii) the Escrow Agent’s only
obligations will be to distribute to the BHC Partner, or to use its best efforts to sell in the market,
the Excess Securities on or before the close of trading on the first trading day following receipt
of written instructions from the BHC Partner to do so and (iii) the BHC Partner must indemnify
and hold harmless the Escrow Agent for any and all costs, expenses and liabilities relating to
such Escrow Account. If the General Partner does not serve as the Escrow Agent then the BHC
314346824.12 30
Partner shall select an Escrow Agent to provide escrow services on terms mutually agreeable to
the General Partner and the BHC Partner.
(d) Any BHC Partner may, upon notice to the General Partner, elect to hold
all or any fraction of such BHC Partner’s interest as a non-voting interest (a “Non-voting
Interest”), in which case such BHC Partner is not entitled to vote or otherwise participate in any
consent or approval of the Limited Partners with respect to the portion of its interest which is
held as a Non-voting Interest (and such Non-voting Interest is not counted in determining the
granting or withholding of any such consent or approval, or the requisite percentage of the
Limited Partners that have consented to, approved, adopted or taken any other action hereunder).
(e) Any interest held for its own account by a BHC Partner that is determined,
at any time, to be in excess of 4.99% (or such other percentage as may be permitted under the
BHC Act) of the interests of the Limited Partners, excluding for purposes of calculating this
percentage portions of any other interests that are Non-voting Interests pursuant to this Section
13.5(e) and any other provision of this Agreement, will be a Non-voting Interest (whether or not
subsequently transferred in whole or in part to any other Person) and will not be included in
determining whether the requisite Percentage in Interest of the Limited Partners, have consented
to, approved, adopted or taken any action hereunder, provided that such Non-voting Interest may
vote on any proposal to continue the business of the Partnership following an Event of
Dissolution but not on the approval of a successor general partner under Section 10.2. Except as
provided in this Section 13.5, an interest held as a Non-voting Interest is identical in all respects
to all other interests held by Limited Partners. Upon any subsequent closing, a recalculation of
the Partnership Percentages held by all BHC Partners shall be made, and only that portion of the
total Partnership Percentages held by each BHC Partner that is determined as of the applicable
subsequent closing date to be in excess of 4.99% (or such other percentage as may be permitted
under the BHC Act) of the Partnership Percentages of the Limited Partners, excluding Non-
Voting Partnership Percentages as of such date, shall be a Non-Voting Partnership Percentage.
SECTION 14. CERTAIN DEFINITIONS.
14.1 Accounting Period. An “Accounting Period” shall be (i) a calendar quarter if
there are no changes in the Partners’ respective interests in the Profits or Losses of the
Partnership during such calendar quarter except on the first day thereof, or (ii) any other period
beginning on the first day of a calendar quarter, or any other day during a calendar quarter upon
which occurs a change in such respective interests, and ending on the last day of a calendar
quarter, or on the day preceding an earlier day upon which any change in such respective interest
shall occur.
14.2 Adjusted Asset Value. The “Adjusted Asset Value” with respect to any asset
shall be the asset’s adjusted basis for federal income tax purposes, except as follows:
(a) The initial Adjusted Asset Value of any asset contributed by a Partner to
the Partnership shall be the gross fair market value of such asset at the time of contribution, as
determined by the contributing Partner and the General Partner.
314346824.12 31
(b) As of the last day of each Accounting Period, the Adjusted Asset Values
of all Partnership assets shall be adjusted to equal their respective gross fair market values, as
determined by the General Partner in accordance with Section 12, and the resulting unrealized
Profit or Loss allocated to the Capital Accounts of the Partners pursuant to Section 5.
(c) The Adjusted Asset Values of all Partnership assets shall be adjusted to
equal their respective gross fair market values, as determined by the General Partner in
accordance with Section 12, and the resulting unrealized Profit or Loss allocated to the Capital
Accounts of the Partners pursuant to Section 5, as of the termination of the Partnership either by
expiration of the Partnership’s term or the occurrence of an event described in Section 14.13.
14.3 Adviser. An “Adviser” shall have the meaning assigned to such term in Section
6.1(c).
14.4 Affiliate. An “Affiliate” of any Person shall mean any Person that directly, or
indirectly through one or more intermediaries, controls, or is controlled by or is under common
control with the Person specified and, with respect to the General Partner, shall include such
other Persons with which the General Partner has a business relationship and designates (with
approval of the Board of Advisors) as an “Affiliate” for purposes of this Agreement.
14.5 Capital Account. The “Capital Account” of each Partner shall consist of its
original capital contribution (i) increased by any additional capital contributions, its share of
income or gain that is allocated to it pursuant to this Agreement, distribution returns pursuant to
Section 7, and the amount of any Partnership liabilities that are assumed by it or that are secured
by any Partnership property distributed to it, and (ii) decreased by the amount of any
distributions to or withdrawals by it, its share of expense or loss that is allocated to it pursuant to
this Agreement, and the amount of any of its liabilities that are assumed by the Partnership or
that are secured by any property contributed by it to the Partnership. The foregoing provision
and the other provisions of this Agreement relating to the maintenance of Capital Accounts are
intended to comply with Treasury Regulation Section 1.704-1(b)(2)(iv), and shall, except where
this Agreement explicitly provides otherwise, be interpreted and applied in a manner consistent
with such Treasury Regulations. In the event the General Partner shall determine that it is
prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are
computed in order to comply with such Treasury Regulations, the General Partner may make
such modification, provided that it will not have more than an insignificant effect on the total
amounts distributable to any Partner pursuant to Sections 7 and 10.
14.6 Capital Commitment. A Partner’s “Capital Commitment” shall mean the
amount that such Partner has agreed to contribute to the capital of the Partnership as set forth
opposite such Partner’s name or number on Schedule A. The General Partner's Capital
Commitment shall include all amounts that the General Partner would be obligated to contribute
pursuant to Section 4.3. The Partnership’s committed capital shall equal the sum of the
aggregate Capital Commitments of all Partners.
14.7 Code. The “Code” shall mean the United States Internal Revenue Code of 1986,
as amended from time to time (or any corresponding provisions of succeeding law).
314346824.12 32
14.8 Custodial Account. The Custodial Account shall mean the custodial capital call
account where amounts drawn down by the General Partner from all Partners shall be deposited
and where returns and distributions from all Partners shall be allocated and available for use in
accordance with the terms of this Agreement. The Custodial Account(s) shall be administered
by the Fund Administrator under the authority of the General Partner.
14.9 Custodial Account Percentage. “Custodial Account Percentage” for each
Partner shall be determined from time to time by dividing (a) an amount for each Partner
determined as (i) the Partner’s capital contributions to the Custodial Account, plus (ii) interest
earned in the Custodial Account and previously allocated to the Partner, plus (iii) Profits
allocated to the Partner that are credited to the Custodial Account, less (iv) the Partner’s
proportionate share of funds previously applied from the Custodial Account to make investments
in Portfolio Securities and to pay expenses and obligations of the Partnership, and less (v) the
Partner’s withdrawals and distributions received pursuant to Section 7 from the Custodial
Account, by (b) the sum of all such amounts for all of the Partners
14.10 Detrimental Act. “Detrimental Act” shall mean (i) gross negligence which
directly causes a material adverse effect to the Partnership or its assets, or (ii) actual fraud or
willful misconduct which directly causes a material adverse effect to the Partnership or its assets.
14.11 ERISA. “ERISA” shall mean the United States Employee Retirement Income
Security Act of 1974, as amended.
14.12 Event of Default. An “Event of Default” means any Default that shall not have
been (i) cured by the Partner who committed such Default within ten (10) days after the
occurrence of such Default, or such other period of time as shall be determined by the General
Partner, in its sole and absolute discretion, or (ii) in the case of a Default committed by a Limited
Partner, waived by the General Partner on such terms as determined by the General Partner, in its
sole and absolute discretion, before such Default has otherwise become an Event of Default
pursuant to clause (i) hereof.
14.13 Event of Dissolution. An “Event of Dissolution” shall mean:
(a) at any time there are no limited partners of the Partnership, unless the
business of the Partnership is continued in accordance with the Delaware Act;
(b) any event that results in the General Partner ceasing to be a general partner
of the Partnership under the Delaware Act, provided that the Partnership shall not be dissolved
and required to be wound up in connection with any such event if (A) at the time of the
occurrence of such event there is at least one remaining general partner of the Partnership who is
hereby authorized to and does carry on the business of the Partnership, or (B) within 90 days
after the occurrence of such event, at least a Majority in Interest of the Limited Partners agree in
writing or vote to continue the Partnership and to the appointment, effective as of the date of
such event, if required, of one or more additional general partners of the Partnership who is
authorized to, and shall, continue the Partnership without dissolution;
(c) the entry of a decree of judicial dissolution under Section 17-802 of the
Delaware Act or any successor provision thereto;
314346824.12 33
(d) the determination of the General Partner in its sole and absolute discretion.
14.14 Fund Administrator. The “Fund Administrator” shall have the meaning set
forth in Section 6.1(b).
14.15 Lock-Up Period. The “Lock-Up Period” shall mean, with respect to any capital
contributed by a Limited Partner to the Partnership that remains in the Custodial Account
without having been invested by the Partnership, the period ending on the last day of the twelfth
month from the date such capital is deposited into the Custodial Account.
14.16 Marketable; Marketable Securities; Marketability. These terms shall refer to
securities that are freely tradable by the holder thereof. For purposes of the preceding sentence,
securities shall be deemed to be freely tradable if: (i) such securities are generally traded on one
or more established public markets, or such securities are equivalent to securities traded on one
or more established public markets; (ii) such securities can be sold by a Limited Partner, in
compliance with Rule 144(e) under the Securities Act or otherwise, without the necessity of any
Federal or State governmental consent, approval or filing (other than notice filings of the type
required pursuant to Rule 144(h) under the Securities Act or any similar law, rule or regulation);
and (iii) such securities are not subject to any “lock-up” or other contractual restrictions on
transfer. For purposes of determining whether securities distributed to a Limited Partner are a
“Marketable,” there shall be taken into account only such restrictions and limitations on the
transferability thereof as apply to the Limited Partners generally (and there shall not be taken
into account restrictions and limitations specifically applicable to a particular Limited Partner,
such as restrictions applicable to a Limited Partner that is an Affiliate of the issuer of such
securities).
14.17 Majority in Interest. A “Majority in Interest” of the Limited Partners as of a
particular date shall mean Limited Partners representing more than 50% of the aggregate Capital
Commitments of the Limited Partners; provided, however, that no Limited Partner interests in
the Partnership held by the General Partner, or by its members or employees, or by the Affiliates
of any of the foregoing, shall be counted for purposes of determining or comprising a Majority in
Interest of the Limited Partners.
14.18 Memorandum. The “Memorandum” shall mean the Confidential Private
Offering Memorandum dated October 31, 2016 relating to the offering of interests in the
Partnership, as same may be amended and supplemented from time to time.
14.19 Money Market Investments. “Money Market Investments” shall mean
government securities, banker’s acceptances, certificates and accounts of savings and loan
associations, commercial paper, certificates of deposit, treasury bills, other money market
investments with maturities of less than twelve months and other similarly liquid securities
providing for appropriate safety of principal..
14.20 1940 Act. The “1940 Act” shall mean the United States Investment Company
Act of 1940, as amended.
14.21 Non-marketable Securities. “Non-marketable Securities” are all Securities other
than Marketable Securities.
314346824.12 34
14.22 Partnership Percentage. The “Partnership Percentage” for each Partner shall be
determined by dividing the amount of each Partner’s Capital Commitment by the sum of the
Capital Commitments of all of the Partners; provided, however, any Capital Commitment made
by a Defaulting Partner at the time of determination of a Partnership Percentage shall be
disregarded.
14.23 Percentage in Interest. A specified “Percentage in Interest” of the Limited
Partners shall mean a group of Limited Partners whose Partnership Percentages exceed the
required percentage of the Partnership Percentages of all such Limited Partners, provided,
however, that no Partnership Percentages of the General Partner, its members or employees or
any Affiliates of the Partner shall be counted for purposes of determining or comprising
Percentage in Interest.
14.24 Person. A “Person” is any individual, partnership, corporation, association, joint
venture, organization, trust or other entity.
14.25 Portfolio Company. A “Portfolio Company” means any Person that is an issuer
of Securities held by the Partnership, whether public or private.
14.26 Portfolio Securities. “Portfolio Securities” shall mean Securities of Portfolio
Companies then held by the Partnership other than Money Market Investments.
14.27 Profit or Loss. “Profit or Loss” shall be the net amount computed for each
Accounting Period as of the last day thereof that is equal to the Partnership’s taxable income or
loss for such Accounting Period, determined in accordance with Section 703(a) of the Code (for
this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant
to Code Section 703(a)(1) shall be included in taxable income or loss), with the following
adjustments:
(a) Any income of the Partnership that is exempt from United States federal
income tax and not otherwise taken into account in computing Profit or Loss pursuant to this
paragraph shall be added to such taxable income or loss;
(b) Any expenditures of the Partnership described in Code
Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Treasury
Regulation Section 1.704-1(b)(2)(iv)(i) and not otherwise taken into account in computing Profit
or Loss pursuant to this paragraph shall be subtracted from such taxable income or loss;
(c) Gain or loss resulting from any disposition of a Partnership asset with
respect to which gain or loss is recognized for United States federal income tax purposes shall be
computed by reference to the Adjusted Asset Value of the asset disposed of rather than its
adjusted tax basis;
(d) The difference between the gross fair market value of all Partnership
assets and their respective Adjusted Asset Values shall be added to such taxable income or loss
as described in Section 14.2;
314346824.12 35
(e) Custodial Account interest income, which is specially allocated pursuant
to Section 5.1(a) and items that are specially allocated pursuant to Sections 5.2 or 5.3 hereof
shall not be taken into account in computing Profit or Loss; and
(f) Upon any distribution in kind, the difference between the fair market value
and the Adjusted Asset Value of the assets distributed shall be added to such taxable income or
loss.
14.28 Regulatory Allocations. “Regulatory Allocations” shall have the meaning
assigned to such term in Section 5.3.
14.29 Regulated Partner. “Regulated Partner” shall mean any ERISA Partner,
Governmental Plan Partner, Private Foundation Partner, Public Charity Partner or BHC Partner
that is specially regulated as described in Section 13 of this Agreement.
14.30 Securities. “Securities” means notes, stocks, bonds, debentures, evidences of
indebtedness, certificates of interest or participation in any profit-sharing agreement, partnership
interests, beneficial interests in trusts, collateral-trust certificates, pre-organization certificates or
subscriptions, transferable shares, investment contracts, voting-trust certificates, certificates of
deposit for securities and certificates of interest or participation in, temporary or interim
certificates for, receipts for or warrants or rights or options to subscribe to or purchase or sell any
of the foregoing, and any other items commonly referred to as securities.
14.31 Securities Act. “Securities Act” shall mean the United States Securities Act of
1933, as amended.
14.32 Treasury Regulations. “Treasury Regulations” shall mean the Income Tax
Regulations promulgated under the Code, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
SECTION 15. OTHER PROVISIONS.
15.1 Governing Law. This Agreement shall be governed by and construed under the
laws of the State of Delaware as applied to agreements among the residents of such state made
and to be performed entirely within such state, without regard to principles of conflicts of laws
thereof.
15.2 Limitation of Liability of the Limited Partners. (a) Except as required by law
or this Agreement (including, without limitation, as provided in this Section 15.2), no Limited
Partner shall be bound by, nor be personally liable for, the expenses, liabilities, or obligations of
the Partnership; provided, however, that each Limited Partner shall be required to contribute
capital to the Partnership in an amount equal to its Capital Commitment; provided, further, that
in accordance with the Act, a Limited Partner that receives from the Partnership a payment
representing a return of contribution at any time when the Partnership is not solvent shall, in the
event of the insolvency of the Partnership within a period of six (6) months from the date of such
payment, be liable to repay the amount of such payment to the Partnership plus statutory interest;
provided, further, that the foregoing shall not limit any obligation or liability of any Limited
Partner to the Partnership set forth in this Agreement or to the extent such obligation or liability
314346824.12 36
is required by law and cannot be determined by agreement of the parties hereto. Each Limited
Partner shall be obligated and liable to the Partnership as expressly provided in this Agreement
15.3 Standard of Care.
(a) Neither the General Partner nor its members (including managing
members), employees, shareholders, directors, attorneys or agents, nor any Affiliates of the
foregoing, nor their partners, principals, employees, attorneys, agents, nor any Limited Partner or
member of the Board of Advisors (each an “Indemnified Party,” together, the “Indemnified
Parties”) shall be liable to any Limited Partner or the Partnership for honest mistakes of
judgment, or for any action taken or omitted to be taken by them in good faith, or for losses due
to such mistakes, action or inaction. An Indemnified Party may consult with counsel and
accountants in respect of Partnership affairs, and, no action or inaction that is consistent with and
committed in reliance upon the advice or opinion of such counsel or accountants shall render
such Indemnified Party liable to any Limited Partner or the Partnership, provided that such
counsel or accountants were selected in good faith and such Indemnified Party has not withheld
from such counsel or accountants a material fact or facts, that if known by such counsel or
accountants at the time of rendering advice and/or an opinion, would have altered such advice or
opinion with respect to the legality and/or the potential consequences to the Partnership of such
action or inaction.
(b) To the extent that at law or in equity, the Indemnified Parties have duties
(including fiduciary duties) and liabilities to the Partnership or to another partner, the
Indemnified Parties acting under this Agreement shall not be liable to the Partnership or to any
such other Partner for its reasonable reliance on the provisions of this Agreement. The
provisions of this Agreement, to the extent that they expand, restrict or eliminate the duties and
liabilities of the Indemnified Parties otherwise existing at law or in equity, are agreed by the
Partners to modify such other duties and liabilities existing at law or in equity to the fullest
extent possible pursuant to applicable law. Notwithstanding any other provision of this
Agreement or other applicable provision of law or equity, whenever in this Agreement the
General Partner is permitted or required to make a decision (i) in its "sole discretion" or "sole
and absolute discretion," the General Partner shall be entitled to consider only such interest and
factors as it desires, including its own interests, and shall, to the fullest extent permitted by
applicable law, have no duty or obligation to give any consideration to any interest of or factors
affecting the Limited Partners, or (ii) in its "good faith" or under another expressed standard, the
General Partner shall act under such expressed standard. Any standard of care and duty imposed
by this Agreement or under Delaware law or any applicable law shall be modified waived or
limited, to the extent permitted by law, as required to permit the General Partner to act under this
Agreement so long as such action is reasonably believed by the General Partner to be in, or not
inconsistent with, the best interests of the Limited Partnership. The General Partner may consult
with legal counsel, accountants, appraisers, management consultants, investment bankers and
other consultants and advisers selected by it, and any act taken in reliance upon the opinion of
such persons as to matters that the General Partner reasonably believes to be within such person's
professional or expert competence shall be conclusively presumed to have been done or omitted
in good faith and in accordance with such opinion.
314346824.12 37
15.4 Indemnification.
(a) The Partnership shall indemnify, out of the assets of the Partnership only,
the Indemnified Parties to the fullest extent permitted by law and shall save and hold them
harmless from and in respect of all (i) reasonable fees, costs and expenses, including legal fees,
paid in connection with or resulting from any claim, action or demand against the Indemnified
Parties or the Partnership, that arise out of or in any way relate to the Partnership, its properties,
business or affairs, and (ii) such claims, actions and demands and any losses or damages
resulting from such claims, actions and demands, including amounts paid in settlement or
compromise (if recommended by attorneys for the Partnership) of any such claim, action or
demand; provided, however, that this indemnity shall not extend to (x) a Detrimental Act on the
part of an Indemnified Party giving rise to the matter at issue or (y) any claim, action or demand
arising solely from an internal dispute between or among the General Partner, the Fund
Administrator, the Adviser or any of their respective employees, former employees, members or
former members.
(b) The Partnership shall have the power, in the sole and absolute discretion
of the General Partner, to indemnify on the same terms as set forth in Section 15.4(a) any Person
who is or was serving, pursuant to a prior written request from the Partnership, as a consultant to,
agent for or representative of the Partnership as a director, officer, employee, agent of or
consultant to another corporation, partnership, limited liability company, joint venture, portfolio
company, trust or other enterprise, against any liability asserted against such Person and incurred
by such Person in any such capacity, or arising out of such Person’s status as such. Any such
Person shall only be entitled to indemnification from the Partnership to the extent that the
liabilities of such Person are not covered by another indemnifying party or by insurance.
(c) Except in the case of proceedings initiated by a Majority in Interest of
Limited Partners, expenses incurred by any Indemnified Party, or any Person described in
Section 15.4(b), in respect of any costs, expenses, damages, claims, liabilities, fines and
judgments (including any cost of the defense of any claim, action, suit, proceeding or
investigation, by or before any court or administrative or legislative body or authority) eligible
for indemnity under this Section 15.4 may be paid by the Partnership in advance of the final
disposition of any such claim or action upon receipt of an undertaking by or on behalf of such
Person to repay such amount unless it shall ultimately be determined that such Person is entitled
to be indemnified by the Partnership as authorized in this Section 15.4.
(d) To the fullest extent possible pursuant to applicable law, the rights
provided by this Section 15.4 shall inure to the benefit of the heirs, executors, administrators,
successors and assigns of each Person eligible for indemnification hereunder.
(e) The General Partner may cause the Partnership to purchase and maintain
insurance on its own behalf, or on behalf of any Person who may be indemnified by the
Partnership under this Section 15.4. The costs of such insurance shall be included as an expense
of the Partnership under Section 6.2(a) of this Agreement. The Partnership will not bear the
costs of insuring any Person in respect of any action for which they are not entitled to
indemnification pursuant to this Section 15.4. The Partnership shall not be liable to make any
payment of amounts otherwise payable to any Indemnified Party if and to the extent that the
314346824.12 38
Partnership has otherwise actually received such payment under any insurance policy and the
General Partner shall use its commercially reasonable efforts to expeditiously recover amounts
under any insurance policy which are otherwise indemnifiable hereunder.
(f) Notwithstanding anything to the contrary in this Section 15.4, to the extent
that an Indemnified Party is also entitled to be indemnified by, or receive advancement from, a
Portfolio Company (or prior Portfolio Company, if applicable), or insurance of the Portfolio
Company (or prior Portfolio Company, if applicable), the Indemnified Party shall first seek
indemnification or advancement with respect to liability arising from service as a director,
manager, officer, member or the equivalent of such Portfolio Company (or prior Portfolio
Company, if applicable) from such Portfolio Company (or prior Portfolio Company, if
applicable), or insurance of the Portfolio Company (or prior Portfolio Company, if applicable),
prior to invoking the provisions of this Section 15.4; provided, however, that the foregoing shall
not prevent or otherwise restrict the Partnership from indemnifying or advancing expenses to an
Indemnified Party in accordance with this Section 15.4 if the General Partner reasonably believes
that any delay in receiving indemnification or advancement from such other sources would
adversely affect such Indemnified Party. In any such instance, to the extent of any Indemnifiable
Amounts paid or advanced by the Partnership, the Partnership shall be (i) fully subrogated to the
rights of the Indemnified Party to the extent of any other sources of indemnification or
advancement available to the Indemnified Party from the Portfolio Company (or prior Portfolio
Company, if applicable) or its insurance company, and (ii) assigned all of the Indemnified
Party’s right to indemnification and advancement from the Portfolio Company (or prior Portfolio
Company, if applicable) or its insurance company. It is agreed and understood that the foregoing
obligations to seek indemnification and advancement from other sources shall only reduce the
Partnership’s obligation of indemnification hereunder to the extent indemnification or
advancement is received by the Indemnified Party from such other sources. The indemnification
and advancement provided by this Section 15.4 shall not be deemed to be exclusive of any other
rights to which any Indemnified Party may be entitled under any agreement, as a matter of law,
in equity or otherwise. In particular, to the maximum extent permitted by law, the Partnership’s
obligation to indemnify an Indemnified Party hereunder shall be secondary to any rights to
indemnification, advancement of expenses and/or insurance provided by a Portfolio Company
(or prior Portfolio Company, if applicable) or its insurance company to such Indemnified Party,
whether such indemnification or advancement is provided by law, contract or otherwise. For
example, in the event that an Indemnified Party is entitled to indemnification from a Portfolio
Company or its insurance company, it is agreed and understood that such Portfolio Company
and/or its insurance company shall be liable for one hundred percent (100%) of the
Indemnifiable Amounts (regardless of whether, for example, the Partnership advanced expenses
to such Indemnified Party or paid any other Indemnifiable Amounts pursuant to this Agreement).
It is further agreed and understood that, notwithstanding the foregoing or any provision of this
Agreement to the contrary, to the extent that an Indemnified Party (the “Subject Person”) is also
entitled to be indemnified by, or receive advancement from, one or more other Indemnified
Parties (whether by law or contract or otherwise), the Partnership’s obligations to the Subject
Person under this Section 15.4 are primary with respect to such indemnification and
advancement owing from such other Indemnified Parties and any obligation of the other
Indemnified Parties to advance expenses or to provide indemnification for the same expenses or
liabilities incurred by the Subject Person are secondary. In any such instance, to the extent of
amounts that have been paid or advanced by an Indemnified Party to a Subject Person, then such
314346824.12 39
Indemnified Party shall be (i) fully subrogated to the rights of the Subject Person to the extent of
any other sources of indemnification or advancement available to the Indemnified Party from the
Partnership under this Section 15.4, and (ii) assigned all of the Subject Person’s rights to
indemnification and advancement from the Partnership under this Section 15.4. For example, in
the event that the Subject Person is a member of the General Partner, and the operating
agreement of the General Partner provides for indemnification of such member, it is agreed that,
between the Partnership and the General Partner, the Partnership shall be liable for one hundred
percent (100%) of any Indemnifiable Amounts (regardless of whether, for example, the General
Partner advanced expenses to such member or paid any other Indemnifiable Amounts pursuant to
this Agreement).
15.5 Dispute Resolution.
(a) Except as agreed in writing by the General Partner, as otherwise
specifically provided in this Agreement, or as otherwise required by a non-waivable provision of
applicable law, any dispute, controversy or claim arising out of or relating to this Agreement,
including but not limited to a claim or controversy regarding the breach, termination,
enforcement, interpretation or validity thereof, including the determination of the scope or
applicability of this agreement to arbitrate, and any tort claim, shall be determined and resolved
by arbitration in San Francisco County, California before three (3) arbitrators. The arbitration
shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures.
Judgment on the Award may be entered in any court having jurisdiction. This clause shall not
preclude parties from seeking provisional remedies in aid of arbitration from a court of
appropriate jurisdiction in San Francisco County, California or, if such proceeding cannot be
lawfully held in such location, as near thereto as applicable law permits.
(b) The prevailing party or parties in any arbitration, court action or other
adjudicative proceeding arising out of or relating to this Agreement shall be reimbursed by the
party or parties who do not prevail for their reasonable attorneys, accountants and expert fees and
related expenses (including reasonable charges for in-house legal counsel and related personnel)
and for the costs of such proceeding.
Notwithstanding any provision of the Agreement to the contrary, this Section 15.5 shall
be construed to the maximum extent possible to comply with the laws of the State of Delaware,
including the Uniform Arbitration Act (10 Del. C. § 5701 et seq.) (the “Delaware Arbitration
Act”). If, nevertheless, it shall be determined by a court of competent jurisdiction that any
provision or wording of this Section 15.5, including any rules of the American Arbitration
Association, shall be invalid or unenforceable under the Delaware Arbitration Act, or other
applicable law, such invalidity shall not invalidate all of this Section 15.5. In that case, this
Section 15.5 shall be construed so as to limit any term or provision so as to make it valid or
enforceable within the requirements of the Delaware Arbitration Act or other applicable law,
and, in the event such term or provision cannot be so limited, this Section 15.5 shall be construed
to omit such invalid or unenforceable provision.
15.6 Execution and Filing of Documents. This Agreement and any amendments
hereto may be executed in two or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same instrument.
314346824.12 40
15.7 Other Instruments and Acts. The Partners agree to execute any other
instruments or perform any other acts that are or may be necessary to effectuate and carry on the
Partnership created by this Agreement.
15.8 Binding Agreement. This Agreement shall be binding upon the transferees,
successors, assigns, heirs and legal representatives of the Partners.
15.9 Notices. Notwithstanding any other provision of this Agreement, any and all
notices to Partners required to be sent pursuant to this Agreement, or that are otherwise desired
to be sent by any Partner or Partners to one or more other Partners in respect of the Partnership,
shall be deemed duly given to each recipient Partner upon the earliest to occur of the following:
(i) personal delivery to the recipient Partner, to the address set forth in such Partner’s
subscription documents, or to any other address which such Partner has provided to the
Partnership for purposes of receiving notices in respect of the Partnership; (ii) the close of
business on the third (3rd) business day after being deposited in the United States mail,
registered or certified, postage prepaid and addressed to such Partner’s address specified in his,
her or its subscription documents, or at any other address which such Partner has provided to the
Partnership for purposes of receiving notices in respect of the Partnership; (iii) the close of
business on the first (1st) business day after being deposited in the United States with a
nationally recognized overnight delivery service, or, if the recipient Partner has an overseas
address, the close of business on the third (3rd) business day after being deposited in the United
States with an internationally recognized courier or delivery service, with delivery charges
prepaid, addressed as provided in the preceding clause (ii); or (iv) actual receipt by such recipient
Partner via any other means (including public or private mail, electronic mail, facsimile, telex or
telegram).
15.10 Power of Attorney. Each Limited Partner hereby designates and appoints the
General Partner its true and lawful attorney, in its name, place and stead to make, execute, sign
and file the Certificate of Limited Partnership and any amendment thereto and such other
instruments, documents or certificates that may from time to time be required of the Partnership
by the laws of the United States of America, the laws of the state of the Partnership’s formation
or any other state in which the Partnership shall do business in order to qualify or otherwise
enable the Partnership to do business in such jurisdictions. Such attorney is not hereby granted
any authority on behalf of the Limited Partners to amend this Agreement except that as attorney
for each of the Limited Partners, the General Partner shall have the authority to amend this
Agreement and the Certificate of Limited Partnership (and to execute any amendment to this
Agreement or the Certificate of Limited Partnership on behalf of itself and as attorney-in-fact for
each of the Limited Partners) as may be required to effect:
(a) A change in the Partnership name pursuant to Section 1;
(b) Admission of additional Partners pursuant to Section 3;
(c) Transfers of Limited Partnership interests pursuant to Section 9;
(d) Extensions of the Partnership term pursuant to Section 10;
(e) Withdrawal of Partners pursuant to Sections 4, 7 or 13;
314346824.12 41
(f) Amendment of this Agreement pursuant to Section 15.11; or
(g) As may otherwise be agreed by a Limited Partner with the General
Partner.
The power of attorney granted herein shall be deemed to be coupled with an interest,
shall (to the fullest extent possible pursuant to applicable law) be irrevocable, shall survive and
not be affected by the dissolution, bankruptcy or legal disability of the Limited Partner and shall
extend to its successors and assigns; and may be exercisable by such attorney-in-fact and agent
for all Limited Partners (or any of them) by listing all (or any of them) of such Limited Partners
required to execute any such instrument, and executing such instrument acting as attorney-in-
fact. Any Person dealing with the Partnership may conclusively presume and rely upon the fact
that any instrument referred to above, executed by such attorney-in-fact and agent, regular and
binding, without further inquiry. If required, each Limited Partner shall execute and deliver to
the General Partner within five days after the receipt of a request therefore, such further
designations, powers of attorney or other instruments as the General Partner shall reasonably
deem necessary for the purposes hereof.
This power of attorney granted by each Limited Partner shall expire as to such Partner
immediately after the complete withdrawal of such Partner as a Partner of the Partnership.
15.11 Amendment.
(a) Except as provided in Section 15.10 and Section 15.11(b) below, this
Agreement may be amended only with the written consent of the General Partner and a Majority
in Interest of the Limited Partners.
(b) The General Partner may, without any action of any other Person, amend
this Agreement to (i) cure any ambiguity herein (ii) correct or supplement any provision herein
which may be inconsistent with any other provision herein, or (iii) to make any changes required
by applicable law which change is deemed to be in the best interests of the Partnership, as
reasonably determined by the General Partner.
(c) Notwithstanding the above, no amendment may (i) modify the method of
making Partnership allocations (except as provided in Section 15.11(b) above), modify the
method of determining the Partnership Percentage of any Partner, change the Capital
Commitment of any Partner (except as provided in connection with any permitted transfer,
admission or withdrawal), reduce any Partner’s Capital Account, amend the provisions of
Section 8 or Section 13 hereof or change the restrictions contained in subparagraph (a) above or
this subparagraph (c), unless each Partner materially and adversely affected thereby has
expressly consented in writing to such amendment, which consent shall not be unreasonably
withheld.
(d) Notwithstanding the above, the Partnership’s or General Partner’s (or its
partners’ or employees’) noncompliance with any provision hereof in any single transaction or
event may be waived in writing by a Majority in Interest of the Limited Partners (not including
the General Partner); provided, however, that no such waiver of noncompliance with any
provision specifically requiring the approval of more than a Majority in Interest of the Limited
314346824.12 42
Partners shall be effective without the approval of such larger Percentage in Interest of the
Limited Partners; provided further, that no such waiver shall be effective if such noncompliance
directly injures some but not all of the Limited Partners unless the Limited Partners directly
injured waive such noncompliance. No waiver shall be deemed a waiver of any subsequent
event of noncompliance. Upon obtaining such approvals required by this Agreement and
without any further action or execution by any other Person, including any Limited Partner, (i)
any amendment, restatement, modification or waiver of this Agreement may be implemented and
reflected in a writing executed solely by the General Partner and (ii) the Limited Partners, and
any other party to this Agreement, shall be deemed a party to and bound by such amendment,
restatement, modification or waiver of this Agreement.
15.12 New Issues. Notwithstanding any provision of this Agreement to the contrary, in
the event that the Partnership invests in Securities that are part of a “new issue” within the
meaning of Rule 5130 of the Financial Industry Regulatory Authority, Inc. (“FINRA”) (the
“New Issue Rule”), such investment shall be made in accordance with all applicable FINRA
rules, including the New Issue Rule. In furtherance (but not limitation) of the preceding
sentence, to the extent necessary to comply with FINRA rules (as determined by the General
Partner in its sole and absolute discretion) only those Limited Partners that have established
through written representations satisfactory to the General Partner that they do not fall within the
proscription of the New Issue Rule (subject to any permissible exemptions provided therein)
with regard to any specific new issue Securities shall have a beneficial interest in such new issue
Securities in excess of any beneficial interest otherwise permitted by the New Issue Rule through
their interest in the Partnership. Under no circumstances shall the General Partner be deemed in
breach of any duty to the Partnership by virtue of causing the Partnership to decline an
opportunity to invest in a new issue Security.
15.13 Entire Agreement. This Agreement (together with the representations and
warranties of each Limited Partner set forth in any subscription agreement executed by such
Limited Partner as well as the terms and provisions of any written agreement executed by the
General Partner and a Limited Partner and designated a “side letter” to this Agreement) contains
the entire understanding and agreement by and among the Partners, and supersedes any prior
written or oral agreement between them respecting the Partnership, and any and all other written
or oral agreements or communications between or among the Partners and any and all agents of
the Partnership. In the event that any section or portion of the Memorandum conflicts with this
Agreement, or arguably conflicts, in any way with this Agreement, this Agreement shall govern.
There are no representations, agreements, arrangements or understandings, oral or written,
among the Partners relating to the Partnership which are not fully expressed in this Agreement
(or in any such Subscription Agreement or side letter), and no Limited Partner has executed and
entered into this Agreement, or given another party a power of attorney to execute this
Agreement on its behalf, in reliance on any representation, agreement, arrangement or
understanding, oral or written, that is not expressed in this Agreement (or in any such
Subscription Agreement or side letter). Each such side letter or Subscription Agreement is a
separate agreement among the General Partner and each Limited Partner, as applicable.
Notwithstanding the provisions of this Agreement, including Section 15.11, or of any
Subscription Agreement, it is hereby acknowledged and agreed that the General Partner on its
own behalf or on behalf of the Partnership without the approval of any Limited Partner or any
314346824.12 43
other Person may enter into a side letter or similar agreement to or with one or more Limited
Partners which has the effect of establishing rights under, or altering or supplementing the terms
of, this Agreement or of any Subscription Agreement. The parties hereto agree that any terms
contained in a side letter or similar agreement to or with one or more Limited Partners shall
govern with respect to such Limited Partner(s) notwithstanding the provisions of this Agreement
or of any Subscription Agreement.
15.14 Titles-Subtitles. The titles and subtitles used in this Agreement are used for
convenience only and shall not be considered in the interpretation of this Agreement.
15.15 Partnership Name. The Partnership shall have the exclusive right to use the
Partnership name as long as the Partnership continues. Effective immediately prior to the
termination of the Partnership, the Partnership shall assign whatever rights it may have in such
name to the General Partner. No value shall be placed upon the name or the goodwill attached to
it for the purpose of determining the value of any Partner’s Capital Account or interest in the
Partnership.
15.16 Counsel to the Partnership. Counsel to the Partnership may also be counsel to a
Partner and the Adviser. The General Partner may execute on behalf of the Partnership and the
Partners any consent to the representation of the Partnership that counsel may request pursuant to
the California Rules of Professional Conduct or other applicable professional rules (“Rules”).
The Partnership has initially selected Manatt, Phelps & Phillips, LLP (“Partnership Counsel”),
as legal counsel to the Partnership, which firm is also serving as counsel to the General Partner.
Each Partner acknowledges that Partnership Counsel does not represent any Limited Partner in
connection with their acquisition of or participation, and ownership interest, in the Partnership in
the absence of a clear and explicit written agreement to such effect between the Limited Partner
and Partnership Counsel, and that in the absence of any such agreement Partnership Counsel
shall to the fullest extent permitted by law owe no duties directly to a Partner in respect of such
acquisition, participation or ownership interest in the Partnership. Notwithstanding any adversity
that may develop, in the event any dispute or controversy arises between any Partner and the
Partnership, or between any Limited Partner or the Partnership, on the one hand, and the General
Partner (or Affiliate of a General Partner) that Partnership Counsel represents, on the other hand,
then each Limited Partner agrees that Partnership Counsel may represent either the Partnership
or such General Partner (or his or her Affiliate) or both, in any such dispute or controversy to the
extent permitted by the Rules, and each Partner hereby consents to such representation. Each
Limited Partner further acknowledges that, whether or not Partnership Counsel has in the past
represented or is currently representing such Limited Partner with respect to other matters,
Partnership Counsel has not represented the interests of any Limited Partner in the preparation
and negotiation of this Agreement.
15.17 Pronouns; Statutory References. All pronouns and all variations thereof shall
be deemed to refer to the masculine, feminine, or neuter, singular or plural, as the context in
which they are used may require. Any reference to the Code, the Treasury Regulations, the
Delaware Act, or other statutes or laws will include all amendments, modifications, or
replacements of the specific sections and provisions concerned.
314346824.12 44
15.18 Jurisdiction and Venue. Unless otherwise agreed in writing by the General
Partner, each Partner hereby consents to the non-exclusive jurisdiction and venue of the state and
federal courts sitting in San Francisco County, California, in any action on a claim arising out of,
under or in connection with this Agreement or the transactions contemplated by this Agreement
that is not otherwise subject to arbitration pursuant to Section 15.5. Each Partner further agrees,
to the fullest extent permitted by laws, that personal jurisdiction over him or her may be effected
by service of process by registered or certified mail addressed as provided in Section 15.9 of this
Agreement, and that when so made shall be as if served upon him or her personally within the
State of California.
15.19 Time is of the Essence. Time is of the essence with respect to this Agreement.
15.20 Reliance on Authority of Person Signing Agreement. If a Partner is not a
natural person, neither the Partnership nor any Partner will (a) be required to determine the
authority of the individual signing this Agreement to make any commitment or undertaking on
behalf of such entity or to determine any fact or circumstance bearing upon the existence of the
authority of such individual or (b) be responsible for the application or distribution of proceeds
paid or credited to individuals signing this Agreement on behalf of such entity.
15.21 Attorney Fees. In the event that any dispute between the Partnership and a
Partner or the Partners, or among the Partners, should result in litigation or arbitration, the
prevailing party in such dispute shall, to the fullest extent permitted by applicable law, be
entitled to recover from the other party all reasonable fees, costs and expenses of enforcing any
right of the prevailing party, including without limitation, reasonable attorneys’ fees and
expenses, all of which shall be deemed to have accrued upon the commencement of such action
and shall be paid whether or not such action is prosecuted to judgment. Any judgment or order
entered in such action shall, to the fullest extent permitted by applicable law, contain a specific
provision providing for the recovery of attorney fees and costs incurred in enforcing such
judgment and an award of prejudgment interest from the date of the breach at the maximum rate
of interest allowed by law. For the purposes of this subsection (a) attorney fees shall include,
without limitation, fees incurred in connection with: (i) post-judgment motions; (ii) contempt
proceedings; (iii) garnishment, levy, and debtor and third party examinations; (iv) discovery; and
(v) bankruptcy litigation, and (b) “prevailing party” shall mean the party who is determined in
the proceeding to have prevailed or who prevails by dismissal, default or otherwise.
15.22 Remedies Cumulative. The remedies under this Agreement are cumulative and
shall not exclude any other remedies to which any Person may be lawfully entitled.
15.23 No Third Party Beneficiary. This Agreement is made solely and specifically
among and for the benefit of the parties hereto, and their respective successors and assigns
subject to the express provisions hereof relating to successors and assigns, and, to the fullest
extent permitted by law, no other Person will have any rights, interest or claims hereunder or be
entitled to any benefits under or on account of this Agreement as a third party beneficiary or
otherwise. The provisions of this Agreement are intended only for the regulation of relations
among the Partners and the Partnership and this Agreement is not intended for the benefit of a
creditor who is not a Partner and does not grant any rights to or confer any benefits on any
creditor who is not a Partner or any other Person who is not a Partner.
314346824.12 45
15.24 Severability. This Agreement shall be construed to the maximum extent possible
to comply with all of the terms and conditions of the Delaware Act. If, nevertheless, it shall be
determined by a court of competent jurisdiction that any provision or wording of this Agreement
shall be invalid or unenforceable under the Delaware Act or other applicable law, such invalidity
or unenforceability shall not invalidate the entire Agreement. In that case, this Agreement shall
be construed so as to limit any term or provision so as to make it enforceable or valid within the
requirements of applicable law, and, in the event such term or provision cannot be so limited,
this Agreement shall be construed to omit such invalid or unenforceable provision.
15.25 Warranties and Representations. Each Partner separately represents and
warrants that he/she/it is not a party to any pending or threatened suit, action or legal,
administrative, arbitration or other proceeding which might materially and adversely affect the
business of the Partnership or the transactions contemplated by this Agreement, nor does such
Partner know of any facts which are likely with the passage of time to give rise to such a suit,
action or proceeding. Each Partner separately represents and warrants that he/she/it is not a party
to any agreement, understanding, commitment or other obligation that prohibits or restricts such
Partner’s performance under this Agreement.
15.26 Construction. To the fullest extent permitted by law, every covenant, term and
provision of this Agreement shall be construed simply according to its fair meaning and not
strictly for or against any party (notwithstanding any rule of law requiring an Agreement to be
strictly construed against the drafting party), it being understood that the parties to this
Agreement are sophisticated and have had adequate opportunity and means to retain counsel to
represent their interests.
15.27 Certain Rules of Construction. Whenever the words “including”, “include” or
“includes” are used in this Agreement, they should be interpreted in a non-exclusive manner as
though the words, “without limitation”, immediately followed the same. Unless otherwise
specified in this Agreement, all section, paragraph, schedule and exhibit references in this
Agreement refer to sections, paragraphs, schedules and exhibits of this Agreement, and shall be
treated as if set forth herein.
15.28 Non-Business Days. Whenever action must be taken (including the giving of
notice or the delivery of documents) under this Agreement during a certain period of time or by a
particular date that ends or occurs on a day other than a business day, then such period or date
shall be extended until the immediately following business day.
15.29 Equitable Relief. If any Partner proposes or attempts to transfer all or any part of
its interest in violation of the terms of this Agreement, the Partnership may apply to any court of
competent jurisdiction for an injunctive order prohibiting such proposed transfer except upon
compliance with the terms of this Agreement, and the Partnership may institute and maintain any
action or proceeding against the Person proposing to make such transfer to compel the specific
performance of this Agreement. To the fullest extent permitted by law, any attempted transfer in
violation of this Agreement is null and void, and of no force and effect. The Person against
whom such action or proceeding is brought waives the claim or defense that an adequate remedy
at law exists, and such Person will not urge in any such action or proceeding the claim or defense
that such remedy at law exists.
314346824.12 46
15.30 Waiver of Jury Trial. EACH PARTY HERETO WAIVES TRIAL BY JURY
IN ANY LITIGATION CONCERNING THIS AGREEMENT.
15.31 Not an Offer. The submission of this Agreement for examination is not intended
to nor shall constitute an offer to sell, grant or otherwise convey any of the property or other
rights of any kind with respect to the Partnership or a reservation of, or option or proposal of any
kind for the purchase of an interest in the Partnership. In no event shall any draft of this
Agreement create any obligation or liability on any party or other Person, it being understood
that this Agreement shall be effective and binding only when a counterpart hereof has been
executed, delivered to and accepted by the General Partner, which the General Partner may
accept or reject in its sole and absolute discretion.
15.32 Change in Law. Notwithstanding any provision in this Agreement to the
contrary, in the event that the General Partner determines in good faith, after consultation with
the Partnership’s tax advisers, that there has been a significant change (or there is a significant
likelihood of a such a change) to the expected income tax consequences associated with the
receipt (or allocation) of the General Partner’s “carried interest” (any such determination, a
“Significant Change Determination”), then after consulting with the Board of Advisors, the
General Partner shall be entitled to take any action (including amending this Agreement) that the
General Partner believes to be reasonably necessary to mitigate the impact of any such actual or
expected change in law (provided, however, that if such action adversely affects (as such phrase
is applied by giving effect to the final sentence of this Section 15.32) any Limited Partner, then
such action may not be taken without the consent of Two-Thirds Percentage in Interest of the
Limited Partners). The General Partner shall promptly notify the Limited Partners in the event it
makes a Significant Change Determination and has determined that the action it proposed to take
in response thereto will not adversely affect any Limited Partner, and any such determination
shall be conclusive and binding unless, within ten (10) business days of the date of such notice, a
Majority in Interest of Limited Partners notify the General Partner that they believe that the
action proposed by the General Partner will adversely affect a Limited Partner, in which case the
dispute shall be settled in accordance with Section 15.5. For purposes of this Section 15.32, the
Limited Partners agree that the following shall not be deemed “adverse effects” for the Limited
Partners: (i) the costs of assessing, evaluating, processing or otherwise responding to proposed
amendments (including the fees and costs of attorneys, accountants and other advisers engaged
in connection therewith) incurred by a Limited Partner; (ii) accounting and similar administrative
costs incurred by a Limited Partner; and (ii) any costs or burdens of a de minimis nature. The
costs of assessing, evaluating, processing or otherwise responding to any amendment undertaken
pursuant to this Section 15.32 (including the fees and costs of attorneys, accountants and other
advisers engaged in connection therewith), other than those costs described in the immediately
preceding sentence, shall be borne by the General Partner and shall not be a Partnership expense.
15.33 REGISTRATION. THE LIMITED PARTNERSHIP INTERESTS OF US
CAPITAL CURRENT INCOME FUND, L.P. HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT, THE SECURITIES LAWS OF ANY STATE IN THE UNITED STATES
OR ANY OTHER APPLICABLE SECURITIES LAWS IN RELIANCE UPON EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH
LAWS. SUCH LIMITED PARTNERSHIP INTERESTS MUST BE ACQUIRED FOR
INVESTMENT ONLY AND MAY NOT BE OFFERED FOR SALE, PLEDGED,
314346824.12 47
HYPOTHECATED, SOLD, ASSIGNED OR TRANSFERRED AT ANY TIME EXCEPT IN
COMPLIANCE WITH (i) THE SECURITIES ACT, ANY APPLICABLE STATE
SECURITIES LAWS, AND ANY OTHER APPLICABLE SECURITIES LAWS; AND (ii)
THE TERMS AND CONDITIONS OF THIS PARTNERSHIP AGREEMENT. THE
INTERESTS MAY NOT BE TRANSFERRED OF RECORD EXCEPT IN COMPLIANCE
WITH SUCH LAWS AND THIS PARTNERSHIP AGREEMENT. THEREFORE,
PURCHASERS OF SUCH INTEREST WILL BE REQUIRED TO BEAR THE RISKS OF
THEIR INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
[Signature pages follow]
314346824.12 48
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first written above.
GENERAL PARTNER
US CAPITAL INVESTMENT MANAGEMENT, LLC
By: __________________________________________
(Signature)
Name: __________________________________________, Managing Member
INITIAL LIMITED PARTNER
By: __________________________________________
(Signature)
Name: Jeffrey Sweeney
314346824.12 49
SIGNATURE PAGE TO THE
LIMITED PARTNERSHIP AGREEMENT
OF US CAPITAL BUSINESS CREDIT INCOME FUND
DATED AS OF ______________, 2015
GENERAL PARTNER
By: __________________________________________
(Signature)
Name: __________________________________________
Title: Managing Member
LIMITED PARTNER
By: __________________________________________
(Signature)
Name: __________________________________________
Address:_________________________________________
__________________________________________
__________________________________________
Social Security or Tax ID Number: _____________________
Amount of Desired Capital Commitment: $____________________
314346824.12 2
SCHEDULE A
PARTNER INFORMATION
314346824.12 -i-
Subscription Documents for
US CAPITAL GLOBAL BUSINESS CREDIT INCOME FUND, LP
General Partner:
US Capital Global Investment Management, LLC
555 Montgomery Street, Suite 1501
San Francisco, CA 94111
Tel: (415) 889-1010
Fax: (415) 723-7158
DIRECTIONS FOR THE COMPLETION
OF THE SUBSCRIPTION DOCUMENTS
Prospective investors must complete all of the Subscription Documents contained in this
package in the manner described below. For purposes of these Subscription Documents, the
“Investor” is the person for whose account the interests described herein are being purchased.
Another person with investment authority may execute the Subscription Documents on behalf of
the Investor, but should indicate the capacity in which it is doing so and the name of the Investor.
1. Subscription Agreement and Limited Partnership Agreement:
a. Fill in amount of the desired Capital Commitment on page 11 of the
Subscription Agreement.
b. Date, print the name of the Investor, and sign (and print name,
capacity and title, if applicable) on page 11 of the Subscription
Agreement.
c. Complete the Acknowledgment Form which follows the Investor
Questionnaire (noting by separate attachment any changes necessary to
reflect the Investor’s circumstances).
d. Complete the attached signature page to the Limited Partnership
Agreement (which will only be effective upon acceptance by the
General Partner of your Subscription Agreement).
e. Read all of the enclosed materials carefully, including the Privacy
Notice, attached as Exhibit B.
2. Investor Questionnaire:
a. In Section A, each Investor should fill in his, her or its name, address,
tax identification, telephone number and email address, and also
provide all other requested information.
b. Each Investor should check the box or boxes in Sections B and C
which are next to the categories under which the Investor qualifies as
an “accredited investor” under the Securities Act of 1933, as amended
and a “qualified client” under the Investment Advisers Act of 1940, as
amended.
c. Entities should provide the information and respond to the questions in
Section D.
314466783. 3 i
3. Tax Forms:
The Investor should fill in, sign and date the appropriate Form W-9 or, if not a U.S.
Person (as defined in the attached subscription agreement), then the Investor should fill
in, sign and date the appropriate Form W-8 (W-8BEN, W-8BEN-E, W-8ECI, W-8EXP,
or W-8IMY) in accordance with the instructions to the appropriate form.
4. Evidence of Authorization:
Investor must provide the following documentation to evidence the entity’s authority to
invest in the Partnership (additional documentation may be requested):
Corporations: must submit (i) a certificate or articles of incorporation
and (ii) certified corporate resolutions authorizing the subscription and
identifying the corporate officer empowered to sign the subscription
documents.
Limited liability companies: must submit (i) a certified certificate of
formation and (ii) certified resolutions authorizing the subscription.
Partnerships: must submit a certified copy of the partnership
certificate (in the case of limited partnerships) or partnership
agreement identifying the general partners and evidence of appropriate
authorization authorizing the subscription.
Trusts: must submit a copy of the trust agreement.
Employee benefit plans: must submit a copy of the trust agreement
and a certificate of the trustee or an appropriate officer of the plan’s
investment fiduciary certifying that the subscription has been
authorized and identifying the individual empowered to sign the
subscription documents.
Entities may be requested to furnish other or additional documentation
evidencing the authority to invest in the Partnership.
314466783. 3 ii
5. Delivery of Subscription Documents:
Two completed and signed copies of the Subscription Agreement, along with any
required evidence of authorization, the Investor Questionnaire and any required tax
forms, should be delivered as soon as possible to the General Partner at the following
address:
US Capital Global Business Credit Income Fund, LP
Perennial Fund Services, LLC
32107 Lindero Canyon Road, Suite 202
Westlake Village, CA 91361
Attention: A. J. Haas
Telephone: 888-202-2005
email: [email protected]
Inquiries regarding subscription procedures should be directed to A. J. Haas at the
aforementioned contact number or email.
If the Investor’s subscription is accepted in whole or in part by the General Partner, a
fully executed set of the Subscription Documents will be returned to the Investor.
****
314466783. 3 iii
US CAPITAL GLOBAL BUSINESS CREDIT INCOME FUND, LP
Subscription Agreement
US Capital Global Business Credit Income Fund, LP
Perennial Fund Services, LLC, its Fund Administrator
32107 Lindero Canyon Road, Suite 202
Westlake Village, CA 91361
Attention: A. J. Haas
Ladies and Gentlemen:
1. Subscription. The undersigned (the “Investor”) subscribes for and agrees to
purchase limited partner interests (“Interests”) in US Capital Global Business Credit Income
Fund, LP or such other entity with substantially the same terms as determined by the General
Partner (the “Partnership”) with a Capital Commitment (as defined in the Partnership Agreement
referred to below) in the amount accepted by the General Partner as set forth on the signature
page below, which amount may be, in the General Partner’s sole discretion, less than the amount
set forth on such page by the Investor. The Investor acknowledges that this subscription (i) is, to
the fullest extent permitted by law, irrevocable, (ii) is conditioned upon acceptance by US
Capital Global Investment Management, LLC (the “General Partner”) on behalf of the
Partnership and may be accepted or rejected in whole or in part by the General Partner in its sole
discretion, and (iii) will expire if not accepted by the General Partner on or prior to six (6)
months from the date hereof. Upon acceptance by the General Partner of this Subscription
Agreement, the Investor shall become a Limited Partner of the Partnership and the Investor
agrees to be bound by all the terms and provisions of the Amended and Restated Limited
Partnership Agreement of the Partnership dated October 1, 2019 (as amended or otherwise
modified from time to time, the “Partnership Agreement”), a copy of which shall be made
available upon request. Capitalized terms not defined herein are used as defined in the
Partnership Agreement.
2. Representations and Warranties of the Investor. To induce the General Partner to
accept this subscription, the Investor represents and warrants to the Partnership and the General
Partner as follows:
(a) The Investor has been furnished and has carefully read the Confidential
Private Placement Memorandum dated October 1, 2019 relating to the Partnership (as
supplemented or otherwise restated and amended from time to time, the “Memorandum”) and the
Partnership Agreement. The Investor has such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an investment in the
Interests, is able to bear the risks of an investment in the Interests and understands the risks of,
and other considerations relating to, a purchase of the Interests, including, but not limited to, the
matters set forth under the captions “Executive Summary”, “Risk Factors”, “Executive
Summary of Key Terms” and “Market Opportunity” in the Memorandum.
1
(b) All information which the Investor has provided to the Partnership,
including the information in the Investor Questionnaire, is correct and complete as of the date
hereof.
(c) (i) The Investor has the full power and authority to (x) execute and deliver
this Subscription Agreement, the Partnership Agreement and each other document required to be
executed and delivered by the Investor in connection with this subscription for Interests, (y) to
perform its obligations hereunder and thereunder and consummate the transactions contemplated
hereby and thereby and (z) act as a Limited Partner (as defined in the Partnership Agreement)
thereunder; (ii) the execution and delivery by the Investor, and compliance by the Investor with,
this Subscription Agreement, the Partnership Agreement and each other document required to be
executed and delivered by the Investor in connection with this subscription for Interests does not
conflict with, or constitute a default under, any instrument governing the Investor, any law,
regulation or order, or any agreement to which the Investor is a party or by which the Investor is
bound; and (iii) this Subscription Agreement has been duly executed by the Investor and
constitutes, and the Partnership Agreement, when the Investor is admitted as a Limited Partner
(as defined in the Partnership Agreement), will constitute, a valid and legally binding agreement
of the Investor, enforceable against the Investor according to their terms. If Investor is
purchasing the Interest in a representative or fiduciary capacity, the representations and
warranties contained herein (and in any other written statement or document delivered to the
General Partner in connection herewith) are made on behalf of the person or persons for whom
the Interest is being purchased.
(d) The Investor’s Interests are being acquired for investment, and not with a
view to the sale or distribution of any part thereof, and the Investor has no present intention of
selling, granting participation in, or otherwise distributing the same. Investor further represents
that he, she or it does not have any contract, undertaking, agreement, or arrangement with any
person to sell, transfer, or grant participation to such person, or to any third person, with respect
to Investor’s Interests in the Partnership.
(e) The Investor understands that the Interests have not been registered under
the Securities Act of 1933, as amended (the “Securities Act”), the securities laws of any state
thereof or the securities laws of any other jurisdiction, nor is such registration contemplated. The
Investor understands and agrees further that the Interests must be held indefinitely unless they
are subsequently registered under the Securities Act and these other laws or an exemption from
registration under the Securities Act and these other laws covering the sale of Interests is
available. Even if such an exemption is available, the assignability and transferability of the
Interests will be governed by the Partnership Agreement, which imposes substantial restrictions
on transfer. The Investor understands that legends stating that the Interests have not been
registered under the Securities Act and these laws and setting out or referring to the restrictions
on the transferability and resale of the Interests will be placed on all documents evidencing the
Interests.
(f) The Investor acknowledges and agrees that his, her or its investment in the
Partnership is a speculative investment and involves a high degree of risk of loss of such entire
investment.
314466783.3 2
(g) To the full satisfaction of the Investor, the Investor has been furnished any
materials the Investor has requested relating to the Partnership and the offering of Interests, and
the Investor has been afforded the opportunity to ask questions of representatives of the
Partnership concerning the terms and conditions of the offering and the Interests and to obtain
any additional information necessary to make an informed investment decision. Investor is not
subscribing to the Interests as a result of any advertisement, article, notice or other
communication published in any newspaper, magazine or similar media or broadcast over
television or radio or any other form of general advertising.
(h) The Investor acknowledges and agrees that the Partnership Agreement,
together with the representations set forth in this Subscription Agreement as well as the terms
and provisions of any written agreement executed by the General Partner and the Investor and
designated as a “side letter,” shall contain the entire understanding and agreement with respect to
the Investor’s subscription for, and purchase and ownership of the Interests, and shall supersede
any and all other written materials respecting the Partnership, including, but not limited to, the
Memorandum. Other than as set forth herein, in the Partnership Agreement, and in any such side
letter agreement, the Investor is not relying upon any other information, representation or
warranty by the Partnership, the General Partner or any agent or representative of them,
including, but not limited to, any such information, representation or warranty in the
Memorandum, in determining whether to invest in the Partnership.
(i) The Investor agrees that, except as specifically required by law, he, she or
it shall have no actionable claim or claims against the Partnership, the General Partner or any of
its members, the Adviser or any respective Affiliate of any of the foregoing (also as defined in
the Partnership Agreement), with respect to or arising out of any information, statement or
projection respecting the Partnership, whether written or oral, and including, but not limited to,
any such information, statement or projection made or provided in the Memorandum, which is
not fully expressed in this Subscription Agreement, the Partnership Agreement, or in any side
letter to which the Investor is a party. Further, the Investor acknowledges and agrees that this
Subscription Agreement and any side letter agreement to which the Investor is a party are each
separate agreements by and between the Investor and the General Partner.
(j) The Investor has consulted to the extent deemed appropriate by the
Investor with the Investor’s own advisers as to the financial, tax, legal and related matters
concerning an investment in Interests and on that basis believes that an investment in the
Interests is suitable and appropriate for the Investor. The Investor’s overall commitment to the
Partnership and other investments which are not readily marketable is not disproportionate to the
Investor’s net worth, and the Investor has no need for immediate liquidity in the Investor’s
investment in Interests.
(k) The Investor acknowledges and understands that the Partnership is relying
on Section 3(c)(1) of the 1940 Act as the basis for its exemption from regulation as an
“Investment Company” under said statute, and, consequently, the Investor shall promptly notify
the General Partner of any change in the structure of, or other event relating to, such Investor that
affects how the Interests are held.
314466783.3 3
(l) The Investor acknowledges that the Partnership, and the General Partner
and certain of their Affiliates are subject to certain anti-money laundering and related provisions
and otherwise prohibited from engaging in transactions with, or providing services to, certain
foreign countries, territories, entities and individuals, including without limitation, specially
designated nationals, specially designated narcotics traffickers and other parties subject to United
States government or United Nations sanctions and embargo programs. In furtherance of the
foregoing:
(i) The Investor hereby represents and warrants the following and
shall promptly notify the General Partner if any of the following ceases to be true and accurate:
A. To the best of the Investor's knowledge based upon
appropriate diligence and investigation, none of the cash or property that the Investor has paid or
will pay or contribute to the Partnership has been or shall be derived from or related to any
activity that is deemed criminal under United States law, nor will the proposed investment by the
Investor in the Partnership, which is being made on its own behalf or, if applicable, on behalf of
any beneficial owners, directly or indirectly contravene United States federal, state, international
or other laws or regulations, including any Laws including without limitation, the United States
Bank Secrecy Act, the United States Money Laundering Control Act of 1986, the USA Patriot
Act and the United States International Money Laundering Abatement and Financial Anti-
Terrorist Act of 2001 (the “AML Laws”).
B. No contribution or payment by the Investor to the
Partnership or the General Partner, to the extent within the Investor's control, shall cause the
Partnership or General Partner to be in violation of any AML Laws.
(ii) The Investor understands and agrees that if at any time it is
discovered that any of the representations in this Section 2(l) are untrue or inaccurate, or if
otherwise required by applicable law or regulation related to money laundering and similar
activities, the General Partner may undertake appropriate actions to ensure compliance with
applicable law or regulation, including, but not limited to segregation or redemption of the
Investor's investment in the Partnership.
(iii) The Investor is not (i) identified on the U.S. Department of
Treasury Office of Foreign Assets Control (“OFAC”) list of Specially Designated Nationals and
Blocked Persons (the “SDN List”) codified at 31 CFR Ch. V Annex A, as amended from time to
time1; (ii) owned or controlled by or acting on behalf of any person or entity listed on the SDN
List; (iii) the target of any sanction, regulation or law promulgated by OFAC or any other U.S.
governmental entity (such sanctions, regulations and laws, together with any supplement or
amendment thereto, the “U.S. Sanctions Laws”) such that the entry into this Subscription
Agreement or the performance of any of the transactions contemplated hereby would contravene
such U.S. Sanctions Laws; or (iv) owned or controlled by or acting on behalf of any person or
entity that is the target of any U.S. Sanctions Laws such that the entry into this Subscription
Agreement or the performance of any of the transactions contemplated hereby would contravene
such U.S. Sanctions Laws.
1 The OFAC SDN list may be found at http://www.ustreas.gov/offices/enforcement/ofac/sdn/index.html.
314466783.3 4
(iv) The Investor understands, acknowledges, represents and agrees (i)
that the acceptance of this Subscription Agreement, together with the appropriate remittance, will
not breach any applicable money laundering or related rules or regulations (including, without
limitation, any statutes, rules or regulations in effect under the laws of the United States
pertaining to prohibitions on money laundering or to transacting business or dealing in property
that may be blocked or may belong to Specially Designated Nationals as those terms are used by
the OFAC); (ii) to promptly provide to the Partnership or the General Partner, any administrator
administrating the Partnership (the “Administrator”), or any other party designated for receipt of
such information, documentation verifying its identity and/or source of funds, as well as the
identity of any of its legal or beneficial owners or related parties or affiliates; (iii) that, due to
money laundering requirements within their respective jurisdictions (which requirements are in
effect at the time this Subscription Agreement is submitted to the Partnership or the General
Partner or which become effective at any future time), the Partnership and the General Partner
may require further evidence of the Investor’s identity and/or source of funds before this
Subscription Agreement can be processed, and the Partnership or the General Partner may be
required to take such other actions as may be necessary for the Partnership or the General Partner
to comply with such money laundering regulations; (iv) that it hereby consents to disclosure to
third parties of information provided pursuant to this Section 2(l); and (v) to hold harmless and
indemnify each of the Partnership, the General Partner, the Adviser and their respective
Affiliates against any losses arising from the failure to process such Investor’s agreements if
such Investor does not provide such requested information.
(v) The Investor understands, acknowledges, represents and agrees
that many jurisdictions are in the process of changing or creating anti-money laundering,
embargo and trade sanctions, or similar laws, regulations, requirements (whether or not with
force of law) or regulatory policies, that many financial intermediaries are in the process of
changing or creating responsive disclosure and compliance policies (collectively,
“Requirements”), and that the Partnership and/or the General Partner, as applicable, could be
requested or required to obtain certain assurances from the Investor, disclose information
pertaining to the Investor to governmental, regulatory or other authorities or to financial
intermediaries or engage in further due diligence or take other related actions in the future. The
Investor understands, acknowledges, represents and agrees that it is the Partnership’s and the
General Partner’s policy to comply with Requirements to which it is or may become subject and
to interpret them broadly in favor of disclosure. The Investor hereby agrees, and by reason of
owning any Interests will be deemed to have agreed, to provide additional information or take
such other actions as may be necessary or advisable for the Partnership (in the General Partner’s
sole judgment) and/or the General Partner to comply with any Requirements, related legal
process or appropriate requests (whether formal or informal) or otherwise. The Investor hereby
consents, and by reason of owning any Interests will be deemed to have consented, to any
disclosure by the Partnership and its agents or delegates to relevant third parties of information
pertaining to such Investor in respect of Requirements or information requests related thereto. If
the Investor is acquiring its Interests through a broker-dealer, the Investor hereby expressly
consents to such broker-dealer or its affiliates sharing any and all customer identification, “know
your client,” anti-money laundering and other similar identifying personal and/or corporate,
organizational or beneficial ownership information or data that may be, or is, subject to any
privacy laws with the Partnership, the General Partner, the Adviser and their respective affiliates,
314466783.3 5
designees, officers, employees, directors, partners, agents, legal representatives and controlling
persons.
(vi) The Investor understands, acknowledges and agrees that the
Partnership may not accept any amounts from a prospective Limited Partner if it cannot make the
representations set forth in this Section 2(l). If an existing Limited Partner cannot make these
representations, the Partnership and/or the General Partner may take such action as may be
required under applicable law and the Partnership Agreement. The Investor is advised that, by
law, the Partnership and/or the General Partner may be obligated to “freeze the account” of the
Investor by prohibiting additional subscriptions from the Investor, declining any withdrawal
requests and/or segregating the assets in the account in compliance with governmental
regulations, and the Partnership and/or the General Partner may also be required to report such
action and to disclose the Investor’s identity to applicable governmental authorities. The
Investor further acknowledges that the Partnership and/or the General Partner may, by written
notice to the Investor, suspend the payment of withdrawal proceeds payable to the Investor if the
Partnership and/or the General Partner reasonably deems it necessary to do so to comply with
anti-money laundering regulations applicable to the Partnership and/or the General Partner or
any of the Partnership’s other service providers.
(vii) The Investor understands, acknowledges, represents and agrees
that, to the best of its knowledge, none of (i) the Investor; (ii) any person controlling or
controlled by the Investor; (iii) if the Investor is a privately held entity, any person having a
beneficial interest in the Investor; or (iv) any person for whom the Investor is acting as agent or
nominee in connection with this investment is a senior foreign political figure2 or any immediate
family member3 or close associate4 of a senior foreign political figure as such terms are defined
in the footnotes below.
(viii) If the Investor is a non-U.S. banking institution (a “Non-U.S.
Bank”) or if the Investor receives deposits from, makes payments on behalf of, or handles other
financial transactions related to, a Non-U.S. Bank, the Investor understands, acknowledges,
represents and agrees to the Partnership that: (i) the Non-U.S. Bank has a fixed address, other
than solely an electronic address, in a country in which the Non-U.S. Bank is authorized to
conduct banking activities; (ii) the Non-U.S. Bank employs one or more individuals on a full-
time basis; (iii) the Non-U.S. Bank maintains operating records related to its banking activities;
(iv) the Non-U.S. Bank is subject to inspection by the banking authority that licensed the Non-
U.S. Bank to conduct banking activities; and (v) the Non-U.S. Bank does not provide banking
services to any other Non-U.S. Bank that does not have a physical presence in any country and
that is not a regulated affiliate.
2 A “senior foreign political figure” is defined as a senior official in the executive, legislative, administrative,
military or judicial branches of a non-U.S. government (whether elected or not), a senior official of a major non-U.S.
political party or a senior executive of a non-U.S. government-owned corporation. In addition, a “senior foreign
political figure” includes any corporation, business or other entity that has been formed by, or for the benefit of, a
senior foreign political figure.
3 “Immediate family” of a senior foreign political figure typically includes the figure’s parents, siblings, spouse,
children and in-laws.
4 A “close associate” of a senior foreign political figure is a person who is widely and publicly known to maintain an
unusually close relationship with the senior foreign political figure and includes a person who is in a position to
conduct substantial U.S. and non-U.S. financial transactions on behalf of the senior foreign political figure.
314466783.3 6
(ix) The Investor agrees to notify the Partnership and/or the General
Partner promptly in writing should the Investor become aware of any change in the information
set forth in these representations.
(x) The Investor acknowledges that the Partnership, the General
Partner or any administrator or management company or company acting on behalf of the
Partnership may require further documentation verifying the Investor's identity or the identity of
the Investor's beneficial owners, if any, and the source of funds used to purchase the Interest. The
Investor hereby agrees to provide such documentation as may be requested by the General
Partner. Furthermore, the Investor acknowledges and agrees that the Partnership or General
Partner may release confidential information regarding the Investor and, if applicable, any of the
Investor's beneficial owners, to government authorities if the General Partner, in its sole
discretion, determines after consultation with counsel that releasing such information is in the
best interest of the Partnership in light of any AML Law.
(m) If the Investor is a resident of the United States, the Investor is a resident
of the state identified in his, her or its address set forth on the Investor Questionnaire and the
offer of the Interest was made to the Investor in such state and the Investor intends that the state
securities laws of that state (excluding any other state law) shall govern this transaction.
If the Investor is not a resident of the United States, the Investor
understands that it is the Investor's responsibility to satisfy itself as to full observance of laws of
any relevant territory outside of the United States in connection with the offer and sale of the
Interest, including obtaining any required governmental or other consents, making any filings or
observing any other applicable formalities.
(n) The Investor is a resident of, or its principal place of business is in the
State listed in the Investor’s permanent address set forth in the Investor Questionnaire attached
hereto or previously provided to the General Partner and intends that the securities laws of that
State govern the Investor’s subscription.
(o) If the Investor is, or is acting on behalf of, a trust established under an
employee benefit plan (a “Plan”) as defined in and subject to the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”): (i) it is aware of and has taken into consideration
its fiduciary duties including the diversification requirements of Section 404(a)(1)(c) of ERISA;
(ii) it has concluded that its proposed investment in the Partnership is a prudent one; (iii) the
fiduciary trustee or other person signing this Subscription Agreement on behalf of the Investor is
independent of the General Partner; (iv) this subscription and the investment contemplated
hereby are in accordance with all requirements applicable to the Plan under its governing
instruments and under ERISA; and (v) the Investor acknowledges and agrees that the General
Partner is not a “fiduciary” (within the meaning of Section 3(21) of ERISA) with respect to any
assets of the Plan by reason of the Investor’s investment in the Partnership and that the Investor
has not and is not relying on the General Partner to provide, and it has not provided, any kind of
investment advice with respect to the Investor’s purchase.
(p) If the Investor is not a U.S. Person (as defined below) (a “Foreign
Investor”), such Foreign Investor represents and warrants that he/she (i) will not transfer or
314466783.3 7
deliver any interest in the Interests except in accordance with the restrictions set forth in the
Partnership Agreement and the Memorandum (as defined above); (ii) will notify the General
Partner immediately if the Investor becomes a U.S. Person at any time during which the Investor
holds or owns any Interests; (iii) is not subscribing on behalf of or funding its Capital
Commitments with funds obtained from a U.S. Person; and (iv) is acquiring the Interests to be
acquired hereunder for the Investor’s own account for investment purposes only and not with a
view to resale or distribution.
(q) If the Investor is a Foreign Investor, such Foreign Investor represents and
warrants that except for offers and sales to discretionary or similar accounts held for the benefit
or account of a non-U.S. person by a U.S. dealer or other professional fiduciary, all offers to sell
and offers to buy the Interests were made to or by the Investor while the Investor was outside the
United States and at the time that the Investor’s order to buy the Interests was originated the
Investor was outside the United States.
(r) If the Investor is a Foreign Investor, such Foreign Investor represents and
warrants that the Investor was offered the Interest in the country listed in the Investor’s
permanent address set forth in the Investor Questionnaire attached hereto or previously provided
to the General Partner and intends that the securities laws of that country govern such offering.
3. Tax Information.
(a) If the Investor represents that it is a United States Person, the Investor
certifies that (A) (i) the Investor’s name, taxpayer identification or social security number and
address provided in the Investor Questionnaire is correct and (ii) the Investor will complete and
return with this Subscription Agreement IRS Form W-9, Payer’s Request for Taxpayer
Identification Number and Certification, and (B) (i) the Investor is not (x) a non-resident alien
individual (as defined in the Code (as defined below)) or (y) a foreign corporation, foreign
partnership, foreign trust or foreign estate, as the case may be, and (ii) the Investor will notify the
Partnership within 60 days of a change to foreign status and the new country of residence. For
purposes of this Subscription Agreement, the “Code” shall mean the U.S. Internal Revenue Code
of 1986, as amended from time to time (or any corresponding provisions of succeeding law).
(b) If the Investor represents that it is not a United States Person, such
Investor certifies that (A) (i) the Investor’s name and address provided in the Investor
Questionnaire is correct and (ii) the Investor will complete and return with this Subscription
Agreement (x) IRS Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United
States Tax Withholding and Reporting (Individuals) or (y) IRS Form W-8BEN-E, Certificate of
Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities),
as the case may be, or if applicable Form W-8ECI, W-8EXP or W-8IMY, and if applicable Form
1001, Ownership, Exemption, or Reduced Rate Certificate and (B) (i) the Investor is (x) a
non-resident alien individual (as defined in the Code) or (y) a foreign corporation, foreign
partnership, foreign trust or foreign estate, as the case may be, and (ii) the Investor will notify the
Partnership within 60 days of a change in such foreign status and the new country of residence.
314466783.3 8
(c) The Investor agrees to execute properly and provide to the Partnership in a
timely manner any tax documentation that may be reasonably required from the Investor by the
General Partner in connection with the Partnership.
4. Further Representations and Assurances. All information which the Investor has
provided to the Partnership, including the information in the Investor Questionnaire, is correct
and complete as of the date hereof, and the Investor agrees to notify the General Partner
immediately if any representation or warranty contained in this Subscription Agreement,
including the Investor Questionnaire, becomes untrue at any time. The Investor agrees to
provide such information and execute and deliver such documents as the Partnership may
reasonably request to verify the accuracy of the Investor’s representations and warranties herein,
to comply with any law or regulation to which the Partnership may be subject or for any other
reasonable purpose.
5. Power of Attorney. The Investor, by executing this Subscription Agreement
hereby appoints the General Partner, with full power of substitution, as the Investor’s true and
lawful representative and attorney-in-fact, and agent of the Investor, to execute, acknowledge,
verify, swear to, deliver, record and file, in the Investor’s name, place and stead:
(a) all certificates and other instruments, including the Partnership
Agreement, and any amendments thereto, and all other jurisdictions in which the Partnership
conducts or plans to conduct business (including without limitation any filing for the purpose of
admitting the Investor and others as partners and describing their initial or any increased Capital
Commitments);
(b) any instrument, certificate or other document which may be deemed
necessary or desirable to effect the winding-up and termination of the Partnership (including, but
not limited to, a certificate of cancellation) in accordance with the terms of the Partnership
Agreement;
(c) any instrument or other document which may be deemed necessary or
desirable to effect the transfer of Interests of Limited Partners or to the admission of substitute
Limited Partners in accordance with the terms of the Partnership Agreement;
(d) any other business certificate, fictitious name certificate, amendment
thereto, or other instrument or document of any kind necessary or desirable to accomplish the
business, purpose and objectives of the Partnership, and required by any applicable law;
(e) the Partnership Agreement, any amendments to the Partnership Agreement
or any other agreement or instrument which the General Partner deems appropriate to (i) admit
the Investor as a Limited Partner of the Partnership, (ii) effect the addition, substitution or
removal of any Limited Partner or the General Partner pursuant to the Partnership Agreement or
(iii) effect an amendment or modification to the Partnership Agreement adopted in accordance
with the terms of the Partnership Agreement;
(f) any additional instruments, certificates or documents so authorized by the
terms of the Partnership Agreement.
314466783.3 9
This power of attorney is intended to secure an interest in property, and, in addition, the
obligations of the Investor under this Subscription Agreement and the Partnership Agreement is
irrevocable (to the fullest extent by law) and shall survive, and shall not be affected by, the
subsequent death, disability, incapacity, incompetency, termination, bankruptcy, insolvency or
dissolution of the Investor. This power of attorney will terminate upon the complete withdrawal
of an assigning Partner from participation in the Partnership.
6. Indemnity. To the extent permitted under applicable law, the Investor agrees to
indemnify and hold harmless the Partnership, the General Partner and its partners and each
Limited Partner of the Partnership from and against any loss, damage or liability due to or arising
out of a breach of any representation, warranty or agreement of the Investor contained in this
Subscription Agreement (including the Investor Questionnaire attached hereto) or in any
agreement executed by the Investor with the Partnership or the General Partner in connection
with the Investor’s investment in Interests.
7. For purposes hereof, (a) “United States Person” and “U.S. Person” shall have the
meanings set forth in Regulation S of the Securities Act and Section 7701(a)(30) of the Code.
8. Miscellaneous. To the fullest extent permitted by law, this Subscription
Agreement shall not be assigned by the Investor without the prior written consent of the General
Partner. The representations and warranties made by the Investor in this Subscription Agreement
(including the Investor Questionnaire attached hereto) shall survive the closing of the
transactions contemplated hereby and any investigation made by the Partnership or the General
Partner. The representations and warranties made by the Partnership and the General Partner in
this Subscription Agreement shall survive the closing of the transactions contemplated hereby.
The Investor Questionnaire, including without limitation the representations and warranties
contained therein, is an integral part of this Subscription Agreement and shall be deemed
incorporated by reference herein. If any of the terms of this Subscription Agreement or the
performance thereof shall be invalid or unenforceable to any extent, such invalidity or
unenforceability shall not affect or render invalid or unenforceable any other provision of this
Subscription Agreement, and this Subscription Agreement shall be valid and enforceable to the
fullest extent permitted by law. Neither this Subscription Agreement nor any term hereof may be
changed, waived, discharged or terminated orally but only with the written consent of the
Investor and the General Partner. Notwithstanding anything herein to the contrary, it is hereby
acknowledged and agreed that the General Partner on its own behalf or on behalf of the
Partnership without the approval of any Limited Partner or any other Person may enter into a
side letter or similar agreement to or with one or more Limited Partners which has the effect of
establishing rights under, or altering or supplementing the terms of, its Subscription Agreement.
The parties hereto agree that any terms contained in a side letter or similar agreement to or with
one or more Limited Partners shall govern with respect to such Limited Partner(s)
notwithstanding the provisions of its Subscription Agreement. This Subscription Agreement
may be executed in one or more counterparts, all of which together shall constitute one
instrument, and shall be governed by and construed in accordance with the laws of Delaware.
[Rest of Page Intentionally Left Blank]
314466783.3 10
IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement on
the date set forth below.
Desired Amount of Capital Commitment:
$
INVESTOR:
By: (Print Name of Entity)
Name: (Signature)
Title:
Print Name of Signatory
Print Title of Signatory
11
ACCEPTANCE OF SUBSCRIPTION
(to be filled out only by the General Partner)
The General Partner hereby accepts the above application for subscription for Interests on behalf
of the Partnership and upon such date the Investor will be admitted as a Limited Partner.
Executed by: Amount of Capital Commitment Accepted:
$
US Capital Global Investment Management,
LLC
Its: General Partner
By:
Name:
Title: Managing Member
12
SIGNATURE PAGE TO THE
LIMITED PARTNERSHIP AGREEMENT
OF US CAPITAL GLOBAL BUSINESS CREDIT INCOME FUND, LP
DATED AS OF ____________________
GENERAL PARTNER
US CAPITAL GLOBAL INVESTMENT MANAGEMENT, LLC
By: __________________________________________
(Signature)
Name: __________________________________________
Title: Managing Member
LIMITED PARTNER
By: __________________________________________
(Signature)
Name: __________________________________________
Address: ________________________________________
__________________________________________
__________________________________________
Social Security or Tax ID Number: _____________________
Amount of Desired Capital Commitment: $____________________
314466783.3
INVESTOR QUESTIONNAIRE
A. General Information //
1. Print Full Name of Investor Entity:
2. Date of Incorporation/Formation
3. Legal Form of Entity (e.g., Partnership,
Corporation, LLC, Trust, Tax Exempt,
etc.):
4. Business Address:
5. Mailing Address:
6. Telephone Number:
7. Email Address (required):
8. U.S. Taxpayer Identification Number:
9. Name of Primary Contact Person
(if different from Investor):
Title/Capacity:
Telephone Number:
Email Address (required):
10. Name of Authorized Signatory (if
applicable):
Title/Capacity:
314466783.3 Investor Questionnaire, page 1
Telephone Number:
Email Address (required):
Note: If additional individuals need to be copied on communications, please attach a separate
page listing the individuals and their email addresses (email addresses are required).
11. Is the Investor a U.S. Person?
Yes No
12. “Bad Actor” Disqualification: Is the undersigned subject to “Bad Actor” disqualification,
as such term is used in Rule 506(d) of Regulation D promulgated by the Securities and
Exchange Commission5?
Yes No
B. Accredited Investor Status
1. The Investor represents and warrants that the Investor is an “accredited investor” within
the meaning of Rule 501 of Regulation D under the Securities Act of 1933, as amended (the
“Securities Act”), and has checked the box or boxes below which are next to ALL OF the
categories under which the Investor qualifies as an accredited investor:
(A) Any director, executive officer, or general partner of the issuer of the
securities being offered or sold, or any director, executive officer, or general
partner of a general partner of that issuer.
(B) A bank as defined in Section 3(a)(2) of the Securities Act or any savings
and loan association or other institution as defined in Section 3(a)(5)(A) of
the Securities Act, whether acting in its individual or fiduciary capacity.
(C) An insurance company as defined in Section 2(13) of the Securities Act.
(D) A broker-dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934.
5 Rule 506(d) disqualifies persons who have been convicted of certain felonies and misdemeanors or who have been
subject to certain orders, judgments or decrees. The full text of Rule 506(d) may be found in Exhibit A to this
Investor Questionnaire.
314466783.3 Investor Questionnaire, page 2
(E) An investment company registered under the Investment Company Act of
1940. If an Investor has checked this box, please contact the General
Partner for additional information that will be required.
(F) A business development company as defined in Section 2(a)(48) of the
Investment Company Act of 1940.
(G) A small business investment company licensed by the Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958.
(H) A private business development company as defined in Section 202(a)(22)
of the Investment Advisers Act of 1940. If an Investor has checked this
box, please contact the General Partner for additional information that will
be required.
(I) A corporation, partnership, Massachusetts or similar business trust, or an
organization described in Section 501(c)(3) of the Internal Revenue Code,
not formed for the specific purpose of acquiring Interests, with total assets
in excess of $5 million.
(J) A trust with total assets in excess of $5 million not formed for the specific
purpose of acquiring Interests, whose purchase is directed by a person with
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of an investment in the Interests.
(K) An employee benefit plan within the meaning of ERISA if the decision to
invest in the Interests is made by a plan fiduciary, as defined in Section
3(21) of ERISA, which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or if the employee
benefit plan has total assets in excess of $5 million or, if a self-directed plan,
with investment decisions made solely by persons that are accredited
investors.
(L) A plan established and maintained by a state, its political subdivisions, or
any agency or instrumentality of a state or its political subdivisions, for the
benefit of its employees, if the plan has total assets in excess of $5 million.
314466783.3 Investor Questionnaire, page 3
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US Capital Global Credit Income Fund – Investor Pack - 30 Oct 19
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